"In a word, there is still much to be desired. We still have quite a daunting task," said Xie Zhenhua, vice chairman of the National Development and Reform Commission, which executes energy and environment policy.
Last week Premier Wen Jiabao announced that key measures of energy efficiency and pollution emissions showed progress in 2007.
China's energy consumption per unit of gross domestic product dropped 3.27 percent for the year.
Meanwhile, sulphur dioxide emissions fell 3.14 percent while chemical oxygen demand, a measure of water pollution, fell 4.66 percent.
The government said it was the first year that both pollution indicators had fallen.
However, at that pace none of the indicators will hit China's ambitious 2010 goals without dramatic improvements, said Xie, who spoke on the sidelines of the National People's Congress under way this month.
"We still face a challenging situation. The economy continues to grow and the pattern of heavy industrialisation has not changed," Xie said.
Xie reiterated Beijing's position that the main obstacle to progress continues to be resistance in the country's far-flung provinces, where the drive for economic growth continues to trump central government directives.
"Our enterprises are far from self-motivated to take the initiative to eliminate inefficient production," he said, adding that government enforcement has also been disappointing.
China has set a 2006-2010 target of reducing energy consumption per unit of GDP by 20 percent, and cutting the two pollutants by 10 percent each.
China's booming economy has come at a huge environmental cost, with up to 70 percent of its waterways polluted and air quality in its biggest cities among the world's worst.