The paper reviews China＇s energy conservation in an international perspective. Its purpose is to shed light on the accomplishments to date of China＇s energy conservation efforts and to derive China＇s actual potential for longer-term energy conservation through a sector by sector comparison of energy intensity in physical terms. Moreover, in order to promote such a potential, the paper concludes that there is a need in drastic reform of China＇s energy policies combined with fundamental reform of aid and loan practices.