Beijing Optimizes Financial Services to Promote the Construction of "Two Zones" to Make Green Innovation "Profitable"
With the issuance of the "Work Plan for Supporting Beijing to Deepen the Construction of a Comprehensive Demonstration Zone for the Expansion and Opening-up of the National Service Industry", Beijing's financial service model and management methods are also being optimized. Through financial means such as "stock options" pilots, paid bidding in the carbon market, and voluntary emission reduction trading, Beijing has guided capital investment in innovation, enterprises to take the initiative to reduce emissions, and the whole society to participate in low-carbon actions.
"Stock options" guide capital to invest in science and technology
To build an international science and technology innovation center in Beijing, it is necessary to enable more technology-based small, medium and micro enterprises and "specialized, special and new" enterprises to obtain the support of "friendly capital" at the early stage of entrepreneurship. However, the high risk of investing in technology companies in the early stage of entrepreneurship often discourages investment institutions.
In November 2022, the China Securities Regulatory Commission (CSRC) approved the launch of the country's first comprehensive stock option service pilot at the Beijing Equity Exchange Center, taking the lead in exploring the way to solve the problem.
It can be simply understood as a financial instrument, that is, when the enterprise gets the funds of the investment institution, it should give the institution a choice, that is, it is agreed that at a certain time in the future, the institution can subscribe for a certain amount of premium equity of the enterprise. Because of the use of stock options as a risk "cushion", the enthusiasm of institutional investment enterprises will increase, and in the future, it can choose to exercise its rights to become a shareholder of the enterprise, or it can transfer the rights to a third party for realization, so as to obtain more returns. Stock options help guide all kinds of social capital to "invest early", "invest small" and "invest in technology".
The first case in the country soon appeared. Beijing Hangjing Innovation Technology Co., Ltd., located in Fangshan, is a high-tech enterprise engaged in the R&D and manufacturing of industrial-grade unmanned helicopters. In 2021, Zhongguancun Development Group will solve a total of 50 million yuan of financing for this company, helping the company to accelerate the breakthrough of "from 0 to 1", and the two parties also signed a stock option agreement. As soon as the Beijing stock option pilot was launched, Zhongguancun Development Group transferred the stock options held by it through the pilot platform and obtained a premium income of 2 million yuan.
"Innovative companies get valuable development funding, and investors get more returns. The relevant person in charge of the Beijing Equity Exchange Center said that the stock option pilot has further smoothed the virtuous circle of "technology-industry-capital". As of the end of last year, 83 share options had been registered by Industrial and Commercial Bank of China, Bank of Beijing, China Everbright Bank, China CITIC Bank, Zhongguancun Development Group and other institutions, involving a financing amount of 770 million yuan.
The carbon market is a profitable way for companies to reduce emissions
"Carbon emissions have costs, and carbon reduction has benefits". In 2023, the Beijing ETS launched two paid auctions for allowances, with a total of 66 units successfully bidding for 1.527 million tonnes of carbon allowances, with a total auction price of 160 million yuan. Beijing has also basically finalized the paid bidding model for the carbon market.
Market mechanisms can incentivize the innovation and application of low-carbon technologies. The adoption of low-carbon technologies by enterprises can reduce actual emissions, obtain surplus allowances, and achieve economic benefits in the carbon market, thereby forming a positive cycle of promoting the application of technological innovation. Beijing Public Transport Group was included in the carbon market management in 2016, and due to the active promotion of low-carbon electric vehicles and natural gas vehicles to replace high-carbon emission diesel vehicles, the unit's diesel consumption in 2022 decreased by nearly 75% and carbon emission intensity decreased by 17.8% compared with 2016. Since 2018, its carbon emission allowance has begun to be surplus, and in 2022, it will have a surplus of 55,000 tons, with a market value of more than 600 yuan.
The carbon market can also effectively promote emitting entities to increase their emission reduction efforts, and encourage emitting entities to take active measures to reduce carbon emissions. From 2017 to 2019, Beijing Drainage Group has a quota deficit of tens of thousands of tons every year, through management innovation, the use of biogas, photovoltaic power generation and other energy substitution and energy-saving transformation and other measures, in the case of increased sewage treatment to reduce carbon emissions, in 2020 to achieve quota surplus, the existing cumulative rich quota of about 79,000 tons, the market value of more than 790 yuan. By 2025, the Group plans to reduce its carbon emissions and carbon intensity by more than 20% compared to 2020.
As of 2023, the Beijing carbon market has been running smoothly for 10 years, and a sound institutional system has been built. The Municipal Bureau of Ecology and Environment has continuously improved the system design, and innovatively carried out paid bidding for quotas, green electricity-carbon market connection, and carbon inclusive project development. In 2023, the trading price of Beijing's carbon market will be stable and rising, with an annual turnover of 6.13 million tons and a turnover of 586 million yuan, both higher than the level in 2022.
It is worth mentioning that in 2023, more than 870 key carbon emission units in the city will complete the settlement of allowances. A total of nearly 1,300 units in the city are under control, accounting for more than half of the city's total carbon emissions, covering eight industries, including power generation, heat production, petrochemical production, and service industries. These key carbon emitting units have actively carried out low-carbon technological transformation and improved management levels, and their emission reduction is significantly higher than the overall level of the city, effectively supporting the completion of the city's carbon emission control goals.
Voluntary emission reduction trading promotes low carbon for all employees
The carbon trading market is an important policy tool that uses market mechanisms to promote the control of greenhouse gas emissions. The greenhouse gas voluntary emission reduction trading market is an important part of China's carbon market system. Beijing actively supports the construction of a national voluntary greenhouse gas emission reduction trading market, and trading institutions have settled in Beijing.
Voluntary emission reduction trading is an internationally advocated incentive means for carbon emission reduction, aiming to encourage the participation of various entities that do not bear mandatory emission reduction obligations. The project owner voluntarily develops and implements emission reduction projects in accordance with the methods prescribed by the state, and the emission reductions generated become certified voluntary emission reductions (CCER) after being verified by a third-party agency, which can be traded in the market. Voluntariness and good faith are the most striking characteristics.
According to the Municipal Bureau of Ecology and Environment, the launch of CCER trading provides an important policy tool to promote the green and low-carbon transformation of the economy and society and achieve high-quality development. Project owners can obtain economic returns through the sale of CCER, and participate more actively and consciously in the development and application of low-carbon technologies, key emitting enterprises can use CCER to offset part of their carbon emissions, providing flexibility for carbon emission compliance, and enterprises and individuals can purchase CCER to offset their own carbon emissions, fulfilling their low-carbon action commitments and fulfilling social responsibilities. CCER trading also provides a new way for the whole society to participate in green and low-carbon actions and transform lucid waters and lush mountains into gold and silver mountains.
