Update on Chinese Regulatory Policy August 2023
On 25 July 2023, Beijing published a notice on the principles of energy attribute certificates (EAC) for renewable generators in China. The notice was jointly delivered by the National Development and Reform Commission, the Ministry of Finance, and the National Energy Administration. It describes EAC registration criteria, transaction and use principles, and aspirational targets—including linkages to international systems, and increased production and consumption of clean electricity.
In addition to the communication from 25 July, the Chinese State Council released a 24-point policy related to attracting foreign investment on 13 August 2023 in which policies are to be introduced to support green power consumption and foreign-invested enterprises’ to have “increased participation in green power certificate tracking and cross-provincial and cross-regional green power trading.”
The I-REC Standard Foundation (the I-REC Standard) is recognized as a credible clean electricity tracking instrument by all major reporting frameworks, including RE100 and SBTi, and as a result, is a critical tool for end users across the world. The I-REC Standard is working closely with national actors in the public and private sectors to ensure continued access to reputable energy certificates, while at the same time protecting against risks of double counting. Proposed approaches seek to ensure that both national and domestic actors can access high-quality EACs that meet all relevant domestic and international disclosure requirements.
The recent notices show parties that national authorities are actively looking into the benefits of EACs and the importance of international standardization. At present, the notices do not directly address implementation dimensions of national EAC markets such as how it will be implemented, and any relevant monitoring or enforcement features.
The I-REC Standard is fully committed to supporting the implementation of robust EAC systems to address both domestic and global EAC needs. The I-REC Standard recognizes the authority of national governments and expresses its full support for policymakers in any efforts to build credibility and global recognition of the EAC system in China. Our work will focus on delivering continued access to credible EACs, while at the same time following any national regulations.
Noting the critical need to avoid double issuance while at the same time preserving access to credible EAC products, the active issuance, registration, and facilitation of the I-REC(E) market in China will not be affected by the current policies.
All I-REC(E) registration and issuance criteria remain in effect and unchanged, unless otherwise indicated on the I-REC Standard’s website or notified by the Code Manager, Evident. Notices will be made as needed, based on national requirements communicated to the I-REC Stanard by official channels.
However, Registraints are reminded that assets registered under any environmental commodity system are prohibited from requesting or receiving issuance of I-REC(E). Assets not concurrently registered under any other environmental commodity systems may request registration through Evident and issuance by the relevant Issuer—provided they meet all relevant registration and issuance criteria of Evident or the Issuer, and that they sign a declaration clearly verifying the same generation for which is generating an I-REC is not also being used to create a similar mechanism.