The winter of 2025 was a particularly cold one for some households in rural Hebei. With government subsidies coming down and heating costs going up, people had to think carefully about when to put the heating on and how high to set it – and extra clothes.
This story starts in 2017, when a clean heating transition began in northern China’s Beijing-Tianjin-Hebei region. Local government mostly replaced coal power with gas-fired or electrical alternatives – both considered cleaner than coal. By the end of 2024, 83% of the region’s homes were getting their heating from cleaner sources, according to the environment ministry. Over 40 million households had switched from coal to gas or electric, contributing more than 30% of the regional improvement in air quality.
However, gas shortages in the first year of the transition meant many endured cold homes. Another shortage came in 2022, with the same consequences. Shortages were not a problem this year, but affordability is becoming one. One Hebei farmer, Liu Li, explained his predicament to the Beijing media outlet Sanlian Lifeweek: the end of clean-heating subsidies in 2024 had sent his quarterly heating costs up from CNY 3,000 (USD 440) to CNY 4,000-5,000. That is more than 20% of Hebei’s average household disposable income.
When transitioning to cleaner heat and cleaner air, how do the authorities ensure the costs do not fall disproportionately on poorer people, like Liu Li? Poland, also historically troubled by air pollution, has been trying to answer that question for about as long China. Its Clean Air Programme , launched in 2018, subsidises single-family households still using coal heating to switch to cleaner alternatives. One million Polish households have taken part. In its second largest city, Kraków, the number of days of heavy pollution per year has dropped from 150 to 30 over the past decade.
China and Poland share a similar starting point: their rural homes mostly used coal for heating and were poorly insulated, forming a major source of air pollution. So, what can China learn from Poland about maintaining fairness as it continues reducing rural coal use?
Giving residents a choice in how they heat their home
The choice of technology for rural heating in China lies primarily with the local government. Although the 2017 Beijing-Tianjin-Hebei air pollution policy was designed to take local conditions into account, in effect it was mainly about swapping coal for gas. It has been reported that in Hebei, 2.3 million rural households were switched to gas in 2017, but less than a tenth of that number, 219,000, to electricity. The following two years saw a slightly larger proportion of households moving to electricity, but gas remained dominant.
At the time, air pollution was a severe problem and the shift away from coal was done quickly, Ma Jun, director of the Institute of Public and Environmental Affairs, tells Dialogue Earth. To keep things moving, the authorities went for mature technologies that could be installed swiftly and at little upfront cost. The compulsory changes had an immediate impact on levels of fine particulate matter (PM 2.5) pollution, but not enough consideration had been given to the suitability of gas heating, affordability for rural households or resource availability, he adds.
A 2025 report from Peking University’s Institute of Energy pointed out that local officials were evaluated on how many households had been converted away from coal. Not enough attention was paid to actual heating outcomes, convenience of use or long-term affordability. To an extent, this exacerbated technology mismatches.
But, says Ma Jun, there were later adjustments, with a broader mix of heating sources used. In 2021, the US-based energy transition fund, Energy Foundation, published a report on conversions away from coal in the Beijing-Tianjin-Hebei area and surroundings, and in the Fen-Wei Plain. It said that, as of 2020, 52% of these conversions were to gas, 38% to electricity and the remaining 10% to alternatives. (The Fen-Wei Plain comprises the Fen and Wei river plains and sections of the central provinces Shaanxi, Shanxi and Henan, notably the city of Xi’an.) A villager in Wuzhong, northern China, demonstrates the mobile app that controls their home’s air-source heat pump system – a cleaner alternative to fossil-fuelled heating (Image: Yang Zhisen / Xinhua / Alamy) Poland, by comparison, did not ban the use of coal for domestic heating outright. Residents can still use it, though not in the most polluting stoves. Anna Dworakowska, joint founder of Polish Smog Alert, tells Dialogue Earth that the dirtiest and least efficient stoves are banned, with fines for continued use. And as European Union rules forbid the use of subsidies for fossil fuels, the Clean Air Programme only funds the cleaner options: heat pumps and biofuel burners.
“Residents have a real choice,” says Dworakowska. “They can buy their own cleaner stove, compliant with environmental standards, and keep using coal. Or they can apply for a subsidy for a heat pump or a biofuel heating system. The subsidy isn’t compulsory, it’s an incentive.”
In Poland, installing a heat pump is usually more expensive than a coal furnace but the operating costs may be much lower, according to calculations by the Regulatory Assistance Project, an energy think-tank. In other words, bills do not rise.
Kevin Tu, managing director of the net-zero think-tank Agora Energy China, emphasises that policy implementation should be treated as a “dynamic process of continuous optimisation”. He thinks local governments should guide research institutions, NGOs and private companies to “collaboratively explore the technology pathways best suited to local resources”.
A broad consensus has emerged among the experts: China’s city suburbs suit gas pipelines; the north-west region can use its abundant wind and solar resources to develop a photovoltaic + energy storage + heat pump model; the north-east can promote biomass stoves for both cooking and heating; and in remote areas, coal and high-efficiency stoves should be allowed.
More vulnerable populations need more subsidies
A second key feature of Poland’s clean air efforts are its targeted subsidy levels . The lower household income is, the more government support is on offer, up to 100% of net costs (VAT is not included). Dworakowska says low-income families, particularly in rural areas, need the most help, but are also the hardest for the scheme to reach.
China’s subsidy phaseout has been highly decentralised, with local governments making their own decisions. The Hebei government, for example, began phasing out support in 2019, cutting subsidies by 50% in 2020, 75% in 2021 and ending them entirely in 2022. But in practice, lower-level governments sometimes extend or top up support. Nonetheless the shift away from coal and subsidies has been hitting the poor the hardest. Recommended Kevin Tu highlights that subsidies for some struggling households have been reinstated and increased. In the short term, subsidies will remain necessary to ensure basic levels of heating, particularly in rural areas. But only increased household incomes will balance social and environmental objectives in the longer term, he says.
He thinks China could draw selectively on Poland’s established policy framework to build a more tailored and targeted subsidy system: vulnerable populations would receive higher levels of support, both in absolute terms and as a share of costs, while higher income households would receive less or no assistance.
“Support should be targeted at those most in need, such as the elderly with no source of income, rather than applying uniform subsidy cuts,” Tu says.
Ma Jun, meanwhile, says there is scope to link heating subsidies into the social security system. Higher subsidies could go to recipients of the “Five Guarantees” – a system ensuring vulnerable elderly people, disabled people and children in rural areas have access to basic food, clothing, accommodation, healthcare and deathcare. Low income households could also be prioritisied.
The marginal benefits of air pollution efforts in the cities are reducing […] we may get better results by shifting money to rural areas Ma Jun, Institute of Public and Environmental Affairs director He also suggests an “ecological compensation” mechanism, with those who benefit from the policy helping to fund it via their tax. Urban residents are, he says, the biggest beneficiaries of air quality improvements, while rural residents have had to give up their cheap coal heating and pay more: “The marginal benefits of air pollution efforts in the cities are reducing. Rather than continue seeking opportunities in urban areas, we may get better results by shifting money to rural areas. If rural areas go back to burning coal, any improvements made in the cities will be undercut.”
Tu says that while the approach is logical and fair in principle, practical barriers remain. In most cases, urban subsidy funds are financed through local government revenues. It would be difficult to reallocate resources across administrative boundaries under the current system, and to implement such policy rapidly.
He thinks the government should remove obstacles to private investment in the clean heating field. For example, allowing companies to sell excess heat from industrial processes – supported by clearer property and operating rights – could unlock new investment, he says. Only when heating technologies are economically viable, and companies can close the commercial loop, will the sector be able to reduce its overreliance on subsidies, he adds.
What comes next should come first: Insulation
As well as heat generation, heat retention is also crucial. On the whole, rural buildings in both China and Poland are inadequately insulated.
In Poland, 70% of detached homes lack insulation entirely. As such, a 2025 update to the subsidy rules made insulation plans a required part of an application. An energy audit, upgrade plan and payment of an upfront fee are all now needed.
Dworakowska says this has encouraged improvements to energy efficiency but also added to upfront costs for low income households. That has made it much harder for this group of beneficiaries to apply for the programme. The changes led to a sharp fall-off in applications, and “while the government is making adjustments to the policy, we don’t know yet if application numbers will recover.”
In China, temperatures in rural buildings are often 10C or even 15C lower than those in the cities, despite those households using more energy on the whole.
The early policies on rural heating reform had overlooked insulation. Only more recently have many local governments started adding energy saving measures to their clean-heating policy plans. These kind of improvements should precede clean heating, Ma Jun points out, as the lack of that initial work leads to higher costs and more reliance on subsidies later on. Recommended He says that when money is short, cheaper and easier projects can be prioritised, such as the replacement of doors and windows. Tu, meanwhile, proposes focusing on key living spaces, such as bedrooms and living rooms, to maximise impact for the lowest cost.
Tu adds that China is still urbanising, and investment should therefore prioritise rural buildings that are expected to be lived in over the long term, rather than areas where populations may shrink. He also recommends introducing compulsory insulation requirements for all new rural buildings.
Ma Jun would like to see a shift from a campaign-style approach – one which emphasises wide coverage of clean heating – to one that considers affordability and finer-grained management, to avoid repeating the “one size fits all” mistakes of the past. “The key to policy isn’t just how many households you convert to clean energy, it’s how many of them are able to keep using it in the long term.”
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