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Green policy deepening: Mechanisms, Pathways & Market Opportunities

Jun 17-2025   



Professor Ma Jun, President of The Institute of Finance and Sustainability (IFS), Director of the Green Finance Professional Committee of the Chinese Society of Finance and Co-Director of the Macro and Green Finance Lab, led the discussion.

 

In terms of green financial achievements, China issued a green finance guideline in 2016, and the balance of green credit reached RMB 37 trillion by the end of last year, with a bond market of RMB 2.2 trillion. Regarding the green financial system, elements such as defining standards, environmental performance records, product systems, and incentive mechanisms will be unified in the future to promote the development of the green industry.

 

Regarding the background of transition finance, green finance currently accounts for 14% of all loans. There is significant demand for funds to support the transition to a low-carbon economy, so it is crucial to promote transition finance. Transition finance tools and incentives include sustainable linked loans, interest rates linked to transformation performance, and central bank tools to support pure green industries, which can also support the transformation of enterprises. Some of the pilot schemes have been effective.

 

Ms Wang Min from the Energy Information Center at China Renewable Energy Engineering Institute focused mainly on the current status and outlook of policies on green power and green certificates.

 

Green certificates are connected to the power market via green power trading. There is currently no crossover with the mandatory carbon market, but there is with some projects in the voluntary carbon market. From 2020 onwards, China's green certificates will be mutually recognized with RE100, and by 2025 it is expected that China's green certificates will be unconditionally recognized by CDP. Therefore, promoting China's green certificates is a significant undertaking.

 

After July 2023, green certificates will enter a period of high-quality development. The supply side will require clear management authority and improved certification and trading rules, as well as convergence with the carbon market. The demand side will require alignment with energy-saving and carbon-reduction policies to expand the application market. The annual certification and trading ratio will be low in 2024, so there is a need to further expand application scenarios and improve the green consumption certification and cancellation mechanisms.

 

Yang Lin, General Manager of China Energy Conservation and Environmental Protection Group (CECEP) Hengzhun Technology Service (Beijing) Co., Ltd., shared his insights on green power and green certificates, as well as opportunities in carbon-neutral procurement.

 

There are three modes of green power trading: provincial merchandise in stock, provincial medium&long-term transactions, and inter-provincial medium&long-term transactions. Some provinces have been operating formally, with trading conditions increasing in volume and decreasing in price. The energy law has elevated the incentive mechanism to the legal level and the National Energy Administration has issued a document to refine the trading rules.

 

From the point of view of future green power trends, with the rising supply, wind PV instability requires energy storage. Increased demand from all sectors leads to expansion of the retail market; Green Power and Green Certificates are more finely managed in terms of usage; Green Certificates are in increased supply and prices may remain low, and more channels can make sourcing easier.

 

At the round-table forum, Liu Fan, a member of the Climate Investment and Finance Association (CIFA), as well as an E00 alumnus of PKU NSD, shared his experiences as a green finance practitioner. He discussed the remarkable progress made in disclosing the environmental benefits of green bonds, the unification of financial standards, and the introduction of new ideas to promote green certificates.

 

Ms Wang Min also discussed the current pain points in policy implementation and programs, suggesting that government departments should strengthen policy synergy and encourage the establishment of fiscal and tax incentives and financial preferential mechanisms based on credit and green contributions. This would allow green certificates to play a greater role in providing quantitative services for transition and green finance.

Green policy deepening: Mechanisms, Pathways & Market Opportunities

Jun 17-2025   



Professor Ma Jun, President of The Institute of Finance and Sustainability (IFS), Director of the Green Finance Professional Committee of the Chinese Society of Finance and Co-Director of the Macro and Green Finance Lab, led the discussion.

 

In terms of green financial achievements, China issued a green finance guideline in 2016, and the balance of green credit reached RMB 37 trillion by the end of last year, with a bond market of RMB 2.2 trillion. Regarding the green financial system, elements such as defining standards, environmental performance records, product systems, and incentive mechanisms will be unified in the future to promote the development of the green industry.

 

Regarding the background of transition finance, green finance currently accounts for 14% of all loans. There is significant demand for funds to support the transition to a low-carbon economy, so it is crucial to promote transition finance. Transition finance tools and incentives include sustainable linked loans, interest rates linked to transformation performance, and central bank tools to support pure green industries, which can also support the transformation of enterprises. Some of the pilot schemes have been effective.

 

Ms Wang Min from the Energy Information Center at China Renewable Energy Engineering Institute focused mainly on the current status and outlook of policies on green power and green certificates.

 

Green certificates are connected to the power market via green power trading. There is currently no crossover with the mandatory carbon market, but there is with some projects in the voluntary carbon market. From 2020 onwards, China's green certificates will be mutually recognized with RE100, and by 2025 it is expected that China's green certificates will be unconditionally recognized by CDP. Therefore, promoting China's green certificates is a significant undertaking.

 

After July 2023, green certificates will enter a period of high-quality development. The supply side will require clear management authority and improved certification and trading rules, as well as convergence with the carbon market. The demand side will require alignment with energy-saving and carbon-reduction policies to expand the application market. The annual certification and trading ratio will be low in 2024, so there is a need to further expand application scenarios and improve the green consumption certification and cancellation mechanisms.

 

Yang Lin, General Manager of China Energy Conservation and Environmental Protection Group (CECEP) Hengzhun Technology Service (Beijing) Co., Ltd., shared his insights on green power and green certificates, as well as opportunities in carbon-neutral procurement.

 

There are three modes of green power trading: provincial merchandise in stock, provincial medium&long-term transactions, and inter-provincial medium&long-term transactions. Some provinces have been operating formally, with trading conditions increasing in volume and decreasing in price. The energy law has elevated the incentive mechanism to the legal level and the National Energy Administration has issued a document to refine the trading rules.

 

From the point of view of future green power trends, with the rising supply, wind PV instability requires energy storage. Increased demand from all sectors leads to expansion of the retail market; Green Power and Green Certificates are more finely managed in terms of usage; Green Certificates are in increased supply and prices may remain low, and more channels can make sourcing easier.

 

At the round-table forum, Liu Fan, a member of the Climate Investment and Finance Association (CIFA), as well as an E00 alumnus of PKU NSD, shared his experiences as a green finance practitioner. He discussed the remarkable progress made in disclosing the environmental benefits of green bonds, the unification of financial standards, and the introduction of new ideas to promote green certificates.

 

Ms Wang Min also discussed the current pain points in policy implementation and programs, suggesting that government departments should strengthen policy synergy and encourage the establishment of fiscal and tax incentives and financial preferential mechanisms based on credit and green contributions. This would allow green certificates to play a greater role in providing quantitative services for transition and green finance.