The central bank’s carbon emission reduction support tool can be called a major event in the field of green finance in 2021, and the landing of its first batch of funds has attracted the attention of the industry.
At the beginning of 2022, large state-owned banks successively disclosed the funds obtained from the first batch of carbon emission reduction support tools of the central bank. Recently, according to media reports, Agricultural Bank Of China Limited(601288) has received the first batch of carbon emission reduction support tool funds from the Central Bank of 11.368 billion yuan and the National Development Bank of 10.267 billion yuan. The special funds obtained by the two banks have been distributed to projects in the field of carbon emission reduction.
The above two special funds are part of the first batch of carbon emission reduction support tool funds issued by the central bank to national financial institutions. As early as December 30, 2021, at the press conference of “small and micro enterprise financial services and green finance” held by the central bank, sun Guofeng, director of the Monetary Policy Department of the central bank, once disclosed that the central bank has issued the first batch of carbon emission reduction support tool funds of 85.5 billion yuan to relevant financial institutions, and supported financial institutions to issue qualified carbon emission reduction loans of 142.5 billion yuan, a total of 2817 enterprises, Drive the reduction of carbon emission by about 28.76 million tons.
In March 2021, the government work report clearly proposed the establishment of tools to support carbon emission reduction. On November 8 of the same year, the central bank officially announced the launch of carbon emission reduction support tools. Through the direct mechanism of “loan before loan”, the distribution object is tentatively determined to be national financial institutions, providing financial support at 60% of the loan principal, and the interest rate is 1.75%. The central bank made it clear that the tool focuses on supporting three carbon emission reduction areas: clean energy, energy conservation and environmental protection and carbon emission reduction technology.
A number of industry insiders interviewed by the 21st Century Business Herald said that the new tool of carbon emission reduction support of the central bank has adopted the “loan before loan” mechanism for the first time, which can not only leverage bank funds, but also avoid moral hazard of banks to a certain extent. The interest rate of this instrument is only 1.75%, which is lower than the one-year refinancing interest rate, providing preferential treatment for financial institutions.
funds have been distributed to projects in the field of carbon emission reduction
Large state-owned banks take the initiative to disclose the funds for carbon emission reduction support tools “for a reason”. The central bank requires financial institutions to publicly disclose the issuance of carbon emission reduction loans and the amount of carbon emission reduction driven by loans, and the information shall be verified by a third-party professional institution and subject to public supervision.
Specifically, the first carbon emission reduction support fund of Agricultural Bank Of China Limited(601288) has been granted to the first time, which has been issued 18 billion 946 million yuan for the key areas of carbon emission reduction, including clean energy, energy conservation and environmental protection. It supports 263 projects of the national grid’s Zhangbei Internet plus intelligent energy 800MW demonstration project, the Xiangshan Shanxi fisheries complementary Cecep Solar Energy Co.Ltd(000591) power generation project and the Yuanqu pumped storage project. 197 supporting enterprises can drive 3.8256 million tons of carbon emission reduction, accounting for 13.3% of the carbon emission reduction driven by the first batch of carbon emission reduction support tools of the central bank.
Agricultural Bank Of China Limited(601288) said that in the future, it will make full use of special policies such as carbon emission reduction support tools, continue to increase credit supply around three key areas, help the green and low-carbon transformation of coal related traditional industries such as coal and thermal power, strengthen the innovation and promotion of carbon financial products, and further expand the coverage and market influence of green financial products, We will promote the comprehensive green transformation of economic and social development.
The first batch of carbon emission reduction support tool funds obtained by China Development Bank correspond to a number of medium and long-term project loans in the field of carbon emission reduction focusing on clean energy, such as Zhanjiang Xuwen offshore wind farm project, Shandong Wendeng pumped storage power station project and Qinghai Hainan Talatan photovoltaic power station project, which have been actually issued from July to November 2021, with a total loan amount of 17.111 billion yuan, It can drive the annual carbon emission reduction of 3.43 million tons.
Among them, Zhanjiang Xuwen 600MW offshore wind farm project is the largest offshore wind power project in Asia, breaking the record of single installed capacity of China’s offshore wind power production projects; Shandong Wendeng pumped storage power station project is an important project of peak shaving and valley filling in Shandong power grid. It plays an important role in stabilizing system frequency, mitigating accidents and improving power system dynamic benefits; The 1000MW photovoltaic power station project in section I of Talatan, Hainan is the power supply project of Qinghai Henan UHV DC transmission project, which helps the green power “west to East power transmission”.
China Development Bank has made it clear that it should make good use of carbon emission reduction support tools, integrate carbon emission factors into the whole credit process, establish credit carbon accounting information system, gradually update and establish industry accounting model, and is exploring to provide institutional basis and information guarantee for the bank to promote carbon emission reduction loans.
press the “acceleration key” for carbon finance development
Many insiders interviewed by 21st Century Business Herald believe that carbon finance will also become the key word of green finance in 2022.
On December 14, 2021, the climate investment and financing pilot work plan prepared by the Ministry of ecological environment, the central bank and other nine departments made it clear that in the field of carbon finance, pilot local financial institutions are encouraged to explore and carry out carbon financial services, including carbon fund, Carbon Asset pledge loan, carbon insurance and so on.
Not long ago, Lai Xiaoming, chairman of Shanghai Environment Group Co.Ltd(601200) energy exchange, also said in an interview with the media that we should promote the cooperation and linkage development between the financial market and the carbon emission trading market, and promote the innovation of various OTC and OTC derivatives based on carbon emission rights. Promote financial institutions to actively and steadily participate in the construction of carbon financial market and enrich the participants of carbon financial market. Develop carbon finance businesses such as carbon emission right pledge, carbon repurchase, carbon fund and Carbon Trust, and enhance the vitality of carbon finance market.
Recently, Agricultural Bank Of China Limited(601288) cooperated with China carbon emission rights registration and settlement Co., Ltd. (hereinafter referred to as “China carbon Deng”) and launched the “Agricultural Bank of China carbon service” system, becoming the first large state-owned commercial bank to connect with China carbon Deng.
“China carbon registration” is the national carbon emission right registration authority, which implements centralized and unified registration for the holding, change, settlement and cancellation of the national carbon emission right. The “ABC carbon service” is connected with the “China carbon registration” system to provide comprehensive capital settlement services for carbon emission trading of member units in the national carbon market. The “ABC carbon service” system adopts the service output mode of bank enterprise direct connection, enterprise online banking and background management, and has the characteristics of online signing, convenient transaction and compliance security.
According to media reports, by the end of 2021, the “ABC carbon service” helped to successfully complete the quota settlement of the first performance cycle of the national carbon market. Since the system went online, it has operated stably, had a good customer experience and won market recognition.
In fact, after the official launch of online trading in the national carbon market in 2021, the pledge loan of carbon emission trading quota broke the ice.
On July 16, 2021, Industrial Bank Co.Ltd(601166) successfully handled the pledge loan business of carbon emission quota for an environmental protection and energy company in Zhejiang, with an amount of 10 million yuan. This is the first carbon emission quota pledge loan in China on the official launch date of the national carbon emission trading market. It is also the first carbon emission quota pledge loan registered and publicized in the unified registration and publicity system of chattel financing of the credit investigation center of the people’s Bank of China.
innovative carbon financial products “on the road”
Many industry insiders interviewed by 21st Century Business Herald reporters believe that China needs to explore the path of carbon market financialization in line with national conditions, and financial institutions are still “on the road” to innovate carbon financial products.
Zeng Gang, deputy director of the national finance and development laboratory, told the 21st Century Business Herald that the so-called carbon finance now focuses more on some basic services provided by the carbon trading market, such as the management of carbon accounts and the mortgage and pledge of carbon assets. In the medium and long term, in the real financial market, institutional investors should be able to purchase this asset as the object of direct investment, and asset securitization can be carried out on this asset, including the types of financial products such as forward transactions and derivatives, and the types of financial products based on carbon assets will be further enriched.
“The carbon market financialization is not simply to apply the experience of the financial market to the carbon market, but to design a set of carbon market financialization path in line with China’s national conditions based on the particularity of carbon emission rights and combined with China’s actual situation.” Rao Shuling, senior researcher of Beijing Institute of green finance and sustainable development, told the 21st Century Business Herald.
“Carbon market emission data should be open to the financial sector.” Rao Shuling suggested that the competent carbon market authorities should gradually open the carbon emission data of emission control enterprises to financial institutions, and open an exclusive channel for financial institutions to query on the existing carbon emission data platform. Financial institutions can use these data information as the judgment basis for providing financing services. At the same time, it can form the effective supervision of financial institutions on the carbon emission data of emission control enterprises, and promote the authenticity and accuracy of carbon market emission data.
