China 's cabinet Wednesday called on all levels of government to step up their efforts in culling capacity from lagging industries and in curbing the growth of energy-wasteful industries as it warned the country is still a long way from achieving its energy conservation targets by the end of this year.

This year is a "decisive" one and with only eight months left all levels of government must increase their sense of urgency, responsibility and take strong and effective measures to ensure the government's goals are reached, according to the conclusions of a State Council meeting chaired by Premier Wen Jiabao.

China has a goal to cut its energy consumption per unit of gross domestic product, known as energy intensity, by 20% in its 2006-2010 Five-Year Plan, but so far it has reached 14.38%, said the statement posted on the central government's Web site.

The energy intensity reduction is a key way of helping the nation meet its goal of cutting carbon emissions per unit of GDP by 40%-45% by 2020, but as the domestic economy has been recovering, energy demand has also been picking up.

The State Council said that especially since the third quarter of last year, high-energy and high-emission industries have grown rapidly. It said in some cases the trend of easing energy consumption has reversed.

China has targets to cull capacity from sectors using old production technology including those in steel, cement, aluminum, flat glass and paper. The State Council said no new projects or investments will be granted to local governments and enterprises which have not yet met their targets to cull such capacity.

Among its work, the government will also deepen energy pricing reform and push forward tiered pricing for household electricity and put pressure on high-energy, high-emission companies' use of electricity, the State Council said.

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