Accelerating Corporate Renewable Energy Engagement in China

Accompanying the release of the report "Accelerating Corporate Renewable Energy Engagement in China," CRS reviewed the key findings and summarized the report’s recommendations. It assessed the current procurement options in the Chinese voluntary renewable energy market and presented how each option interacts with China’s renewable energy policies. It concluded with recommendations for how the market might be strengthened to boost voluntary procurement of renewable energy.

Transcript

1. ACCELERATING
   CORPORATE
   RENEWABLE ENERGY
   ENGAGEMENT IN CHINA
   Rachael Terada
   DIRECTOR,
   TECHNICAL PROJECTS
   CENTER FOR RESOURCE SOLUTIONS
   D E C E M B E R 1 7 , 2 0 1 9
   Orrin Cook
   DIRECTOR,
   INTERNATIONAL PROGRAMS
   CENTER FOR RESOURCE SOLUTIONS
   

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2. PAGE
   2
   Nongovernmental Organization
   (NGO) creating policy and market
   solutions to advance sustainable
   energy since 1997.
   • Expert assistance
   • Renewable energy and climate policy
   • Renewable Energy Markets annual conference
   • Green-e® certification for suppliers and users of
   renewable energy and carbon offsets in the
   voluntary market
   About CRS
   © 2019 Center for Resource Solutions. All rights reserved.
   

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3. 1. Introduction
   • Background on China’s Electricity Sector
   • Voluntary Renewable Energy Markets
   2. Voluntary Renewable Energy Activities and Purchasing
   Mechanisms in China
   • Existing Mechanisms
   • Emerging Mechanisms
   3. Recommendations
   Outline
   PAGE
   3
   © 2019 Center for Resource Solutions. All rights reserved.
   

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4. China’s
   Electricity Sector
   A SIMPLIFIED EXPLANATION OF
   A COMPLEX SECTOR.
   PAGE
   4
   © 2019 Center for Resource Solutions. All rights reserved.
   

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5. • World’s largest electricity market
   • Highest annual emissions of CO2
   e
   • Generation, transmission, distribution and retail managed by state-owned
   entities (State Grid and Southern Grid)
   • Electricity prices historically determined by government agencies, not market-
   driven
   • Generation hours are granted provincially, rather than economic dispatch
   model
   • Fossil fuel generation given priority in many locations
   China Electricity Sector Background
   PAGE
   5
   © 2019 Center for Resource Solutions. All rights reserved.
   

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6. Renewable Energy in China
   PAGE
   6
   © 2019 Center for Resource Solutions. All rights reserved.
   • China has highest installed renewable energy capacity in the world
   • Curtailment of wind generation as high as 43% in certain provinces
   

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7. Key Chinese Renewable Energy and
   Carbon Policies
   PAGE
   7
   © 2019 Center for Resource Solutions. All rights reserved.
   Feed-in Tariff
   Renewable Energy
   Quota System
   Emissions Trading
   Scheme (ETS)
   

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8. Voluntary
   Renewable Energy
   Markets
   A COMPLEMENTARY TOOL ALONGSIDE
   OTHER ENERGY AND CARBON
   POLICIES
   PAGE
   8
   © 2019 Center for Resource Solutions. All rights reserved.
   

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9. Global Corporate Sourcing of Renewable Energy
   PAGE
   9
   © 2019 Center for Resource Solutions. All rights reserved.
   Source: IRENA, Corporate Sourcing of Renewables: Market and Industry Trends, 2018
   

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10. Common
    Global
    Voluntary
    Market
    Procurement
    Options
    PAGE
    10
    © 2019 Center for Resource Solutions. All rights reserved.
    

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11. Key Criteria for Successful Voluntary
    Markets
    PAGE
    11
    © 2019 Center for Resource Solutions. All rights reserved.
    1. LEGAL BASIS FOR CLAIMS AND ATTRIBUTE TRANSFER
    2. REGULATORY SURPLUS
    3. ATTRACTIVE PRODUCT OPTIONS (PRICE AND/OR
    IMPACT)
    

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12. Procurement
    Options in China
    EVOLVING MARKET. EMERGING
    OPPORTUNITIES. CLAIMS
    UNCERTAINTY.
    PAGE
    12
    © 2019 Center for Resource Solutions. All rights reserved.
    

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13. Existing and Emerging Voluntary Market Renewable Energy
    Products for Corporations in China
    PAGE
    13
    © 2019 Center for Resource Solutions. All rights reserved.
    

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14. PAGE
    14
    © 2019 Center for Resource Solutions. All rights reserved.
    Framework for Evaluation of Voluntary Renewable Energy
    Market Options in China
    

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15. China:
    Existing
    Mechanisms
    PAGE
    15
    © 2019 Center for Resource Solutions. All rights reserved.
    Green Energy
    Certificates
    (GECs)
    On-site
    Renewables
    Direct
    Investment
    

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16. Global
    EAC
    Prices
    PAGE
    16
    © 2019 Center for Resource Solutions. All rights reserved.
    

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17. China:
    Existing
    Mechanisms
    PAGE
    17
    © 2019 Center for Resource Solutions. All rights reserved.
    Green Energy
    Certificates
    (GECs)
    On-site
    Renewables
    Direct
    Investment
    

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18. China:
    Emerging
    Mechanisms
    PAGE
    18
    © 2019 Center for Resource Solutions. All rights reserved.
    Direct Power Purchase
    • Bilateral Contracts
    • Centralized Bidding
    • Listed Transactions
    • Distributed market
    transactions
    Electric Retail
    Providers
    Other Voluntary
    Options
    • Coal Swaps
    • I-RECs
    

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19. Evaluation of Voluntary Market Options
    PAGE
    19
    © 2019 Center for Resource Solutions. All rights reserved.
    VOLUNTARY MARKET
    TOOLS
    KEY BARRIERS AND CHALLENGES POTENTIAL POLICY
    INTERACTIONS
    Green Energy Certificates High Price, Linked to FIT, Not Available for
    All Renewable Energy
    Feed-In Tariff, Renewable Energy
    Quota System, Emissions Trading
    Scheme
    On-Site Renewables Limited Generation, GECs Not Available,
    Capital Requirements
    Feed-in Tariff
    Direct Investment No Renewable Usage Claims, Capital
    Requirements
    Feed-in Tariff
    Direct Power Purchase Complicated Transaction Pathway,
    GECs/Claims Not Always Available
    Feed-In Tariff, Renewable Energy
    Quota System
    Retail Green Power No Current Retail Options Available,
    Claims Difficult To Substantiate
    Feed-In Tariff, Renewable Energy
    Quota System
    IRECs Not Recognized By Government Feed-In Tariff, Renewable Energy
    Quota System, Emissions Trading
    Scheme
    Coal Swap No Renewable Usage Claims Renewable Energy Quota System
    

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20. Recommendations
    PAGE
    20
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21. PAGE
    21
    Green Energy Certificates
    © 2019 Center for Resource Solutions. All rights reserved.
    

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22. PAGE
    22
    Emerging Procurement Options
    © 2019 Center for Resource Solutions. All rights reserved.
    

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23. PAGE
    23
    Policy and Market Interactions
    © 2019 Center for Resource Solutions. All rights reserved.
    

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24. PAGE
    24
    Market Development
    © 2019 Center for Resource Solutions. All rights reserved.
    

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25. Key Recommendations
    PAGE
    25
    © 2019 Center for Resource Solutions. All rights reserved.
    1. Avoid double counting between the renewable energy quota and voluntary
    market
    2. Continue to expand GECs eligibility for use with non-FIT projects and bundled
    procurement options
    3. Prioritize and standardize procedures for bilateral contracts for renewable
    energy through the power exchanges. Coordinate with the GEC system
    4. Use one certificate tracking system for both the renewable energy quota and
    voluntary markets in China
    

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26. PAGE
    26
    © 2019 Center for Resource Solutions. All rights reserved.
    Report Links
    English version:
    https://resource-solutions.org/document/11131901/
    Chinese version:
    https://resource-solutions.org/document/11131902/
    

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27. Upcoming Events
    PAGE
    27
    © 2019 Center for Resource Solutions. All rights reserved.
    SINGAPORE
    APRIL 28,
    2020
    

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28. © 2019 Center for Resource Solutions. All rights reserved.
    Contact.
    Rachael Terada
    Director, Technical Projects
    rachael.terada@resource-solutions.org
    +1.415.561.2135
    Orrin Cook
    Director, International Programs
    orrin.cook@resource-solutions.org
    +1.415.561.2106
    www.resource-solutions.org
    

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29. Q&A
    PAGE
    29
    © 2019 Center for Resource Solutions. All rights reserved.
    

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