Chinese Premier Li Keqiang urged further work on saving energy and reducing emissions, according to an official statement released Sunday.

Li said that the environmental work and economic expansion shall be coordinated, because reducing production capacity creates huge business potential for new, green industries.

China will control total energy consumption with higher efficiency, while optimizing the industrial structure with smart power grids and clean energy like wind power, nuclear power, hydropower and photovoltaic power generation, Li said.

He stressed developing the service industry, which consumes less energy but provides job opportunities, by lowering the threshold of market access with more policy incentives.

According to the government work report delivered by Li on March 5, China will cut steel production capacity by a total of 27 million tonnes this year, slash cement production by 42 million tonnes and shut down 50,000 small coal-fired furnaces across the country, .

"We will strengthen energy conservation and emissions reduction and impose a ceiling on total energy consumption. This year, we aim to cut energy intensity by more than 3.9 percent," Li said in the report.

To hit the target, the market mechanism must push forward energy saving and cleaner air, while demanding more strict punishment for illegal emissions and eluding supervision.

The State Council, China's Cabinet, will organize both open and secret investigations into energy saving and emission cuts this year, to ensure responsibility in environmental protection, Li added.