Summary
Domestic and foreign carbon neutrality policy dynamics (June 23 to July 6): 1) Domestically, the Ministry of Transport and other departments issued opinions on the implementation of "double carbon" work in the field of transportation, proposing to optimize transportation. transportation structure, promote energy-saving and low-carbon transportation, actively guide low-carbon travel, and enhance new momentum for green transformation; The Ministry of Agriculture and Rural Affairs and the National Development and Reform Commission jointly released the "Agricultural and Rural Emission Reduction and Carbon Sequestration Implementation Plan" , proposing energy conservation in the planting industry Six tasks including emission reduction, and ten major actions including reducing methane emissions in rice fields were implemented; the Ministry of Finance and other departments revised and promulgated the "China Clean Development Mechanism Fund Management Measures" to appropriately expand the scope of fund use to support "dual carbon"; The " Industrial Energy Efficiency Improvement Action Plan " released by the Ministry of Industry and Information Technology and others proposes that by 2025, the energy consumption of the added value of industrial units above designated size will drop by 13.5% compared with 2020, and so on. ) Internationally, The U.S. Supreme Court weakened the Environmental Protection Agency’s regulation of power plant emissions, while the Department of Energy revised the standards for the civilian nuclear credit program; the United Kingdom invested 20.9 billion pounds to increase power grid capacity; Germany passed a bill allowing the government to assist energy companies, Plans to levy a natural gas tax; The Netherlands provides 164 million euros in subsidies for natural gas storage, and announces a 750 million euro national hydrogen network plan; Greece plans to cancel the electricity surcharge; Australia strengthens its clean energy agreement with India, and the Australian spot power market restarts .
Hot “Carbon” Research: On June 22, the European Parliament voted to adopt amendments to the Carbon Border Adjustment Mechanism (CBAM) draft, but the free quota exit time, tax scope and carbon cost “tax rebate” are still to be determined later. We judge that the embodied carbon emissions under the new plan will increase, the carbon emission intensity standards will be more stringent, the start time will be postponed, but the transition period for the withdrawal of free quotas will be shortened. Chinese companies may be affected by the following: 1) The affected China-EU trade volume has increased significantly (especially for mid-stream and downstream companies); 2) Some companies cannot pass EU CBAM certification; 3) The transformation window period of Chinese companies may be shortened; 4) There is uncertainty about the impact on backward enterprises. It is suggested that domestic high-energy-consuming enterprises can respond by adapting to EU rules, establishing mutual recognition channels for carbon emissions, reducing carbon emission intensity, and diversifying export layouts. Investors in related fields can pay attention to changes in the industry competition landscape, the increase in the investment value of clean energy operators, and opportunities in carbon monitoring and assessment subdivisions.
Carbon neutral related industry and corporate news: 1) Carbon neutral transformation industry: Han is investigating in Shanxi and hosting a symposium on clean and efficient utilization of coal; Guangzhou City is stepping up its efforts to promote the implementation of energy projects and strive to add a batch of clean coal The six departments of the Ministry of Industry and Information Technology proposed that the energy efficiency of products in steel and other industries should reach international levels by 2025. The Ministry of Industry and Information Technology said that currently lithium resources are still operating at a high level and will do a good job in ensuring power battery resource materials from three aspects. ) Carbon-neutral growth industry: The dual-carbon index continues to pick up, and the growth in industry scale and demand expansion are gradually realized. In the past two weeks, the CICC low-carbon industry index has increased by 8.6%. Carbon neutrality-related industries continued to rebound after consecutive corrections, with energy storage, power batteries and new energy vehicle sectors leading the gains. Specifically, prices in the photovoltaic industry chain increased, with the photovoltaic managers' industry-wide index rising by 2.3% from two weeks ago, and the upstream and midstream manufacturing and downstream power stations rising by 2.6% and 1.0% respectively. New energy vehicles continued to recover strongly in June, with the delivery volume of many car companies hitting record highs and the industry index rising by 7.5%. ) Enterprise "dual carbon" action: COSCO Shipping, PetroChina and China State Shipbuilding, the three major central enterprises signed a contract to create a new model for the development of China's LNG industrial chain; CNOOC released a dual-carbon action plan; the National Energy Group Jiangsu Company's coal-fired power station is very large Large-scale carbon capture technology was launched; Sinochem International released the "2021 Sustainability Report", its 18th sustainable development report; Sinopec geothermal science exhibition opened to promote green and low-carbon concepts.
Sustainable Finance and ESG: 1) Green Bonds : There are 1,516 labeled green bonds in China, with a stock size of 167 million yuan, including 130 carbon-neutral bonds, with a stock of 163.6 billion yuan, accounting for 15% of the total balance of green bonds. 9.8%. A total of 49 new green bonds were issued in June, with an issuance scale of RMB 61.2 billion, which was about 15% lower than the issuance scale of RMB 72.1 billion in May. Among them, 6 carbon neutral bonds were newly issued, with an issuance scale of RMB 11.4 billion. Since the beginning of July, 13 green bonds have been issued, with a scale of RMB 5.1 billion. ) Carbon market: The trading activity of the national carbon market was the same as in the previous period, and the carbon price continued to fluctuate in a narrow range around 59 yuan per ton in 2Q22; Beijing’s carbon price showed an upward trend; the EU carbon market reform pushed the carbon price to a high of 85 euros per ton fluctuation. ) ESG: The State Council issued the "Guiding Opinions on Strengthening the Construction of Digital Government" to promote the realization of dual carbon goals; the "General Principles for Corporate ESG Information Disclosure" and "General Principles for Corporate ESG Evaluation" were released; multiple departments of the Ministry of Finance revised the "China Clean Development Mechanism" Fund Management Measures", broaden the scope of fund use, and add "support for dual-carbon, green and low-carbon activities" and other content.
report views: 1) IEA predicts in "World Energy Investment Report 2022" that total global energy investment will increase by 8% in 2022, reaching 2.4 trillion US dollars. Clean energy investment is expected to exceed US$1.4 trillion, accounting for about 3/4 of the overall energy investment growth, of which investment in renewable energy, efficiency improvements and electric vehicles are the three major driving factors. ) bp released "bp World Energy Statistical Yearbook 2022" pointed out that the global energy system is facing the most severe challenges and uncertainties in the past 50 years. Global energy demand and carbon emissions are still in an upward cycle, with increases of 5.8% and 5.7% respectively in 2021, basically returning to pre-pandemic levels in 2019. ) RMI pointed out in "The Key to Opening a New Era of Green Hydrogen Energy: China's 2030 "Renewable Hydrogen 100" Development Roadmap" that various industries and regions in China have the potential to reach at least 100GW of renewable hydrogen installed capacity in 2030. And the growth in consumer demand mainly comes from the chemical industry, steel and transportation industries.
Cutting-edge science and technology: Binghamton University develops a three-layer bacterial biobattery that can last for weeks; Chinese Academy of Sciences realizes closed-loop cobalt recycling of waste lithium-ion batteries based on deep eutectic solvent; Chinese Academy of Sciences launches high-energy long-term Cycling anodeless sodium battery; Daegu Gyeongbuk Institute of Science and Technology uses nanostructured electrodes to improve the light absorption efficiency of solar cells; Hong Kong University of Science and Technology develops the most durable new hydrogen fuel cell; University of California, San Diego develops new liquefied gas electrolytes Helps manufacture temperature-resistant lithium batteries.
Table of Contents
Carbon Neutral Hotspot Policies/Events
Hotspot "Carbon" Research: The EU Carbon Border Regulation Mechanism is Coming - What do you think? what to do?
Carbon neutrality related industry and corporate news
Sustainable finance and ESG
Dual carbon report perspective
Carbon neutrality cutting-edge science and technology
Weather and climate
Text
Carbon neutrality hot policies/events
chart: hot topics at home and abroad in the past two weeks Policy/Event Tracking (June 23-July 6, 2022)
Source: Government websites such as the State Council, National Development and Reform Commission, Reuters, etc., CICC Research Institute
Domestic Policy and Event Tracking
► Ministry of Transport, etc. 4 Department: Opinions on the implementation of "dual carbon" work in the transportation field were released
html On June 28, four departments including the Ministry of Transport jointly issued to implement the "Central Committee of the Communist Party of China and the State Council's Notice on Completely, Accurately and Comprehensively Implementing the New Development Concept to Do a Good Job in Carbon Peaking and Carbon Neutrality" The implementation opinions of "Opinions" put forward the working principles of overall promotion, energy conservation, reform and innovation, and scientific and orderly work, emphasizing optimizing the transportation structure, promoting energy-saving and low-carbon transportation, actively guiding low-carbon travel, and enhancing the green transportation New driving forces for transformation and strengthening organizational implementation and other key contents.[1]► Ministry of Agriculture and Rural Affairs, National Development and Reform Commission: "Implementation Plan for Agricultural and Rural Emission Reduction and Carbon Sequestration"
html On June 30, the Ministry of Agriculture and Rural Affairs and National Development and Reform Commission jointly released "Implementation Plan for Agricultural and Rural Emission Reduction and Carbon Sequestration" . The "Plan" proposes that by 2025, a pattern that integrates agricultural and rural emission reduction and carbon sequestration with food security, rural revitalization, and agricultural and rural modernization will be basically formed; by 2030, the comprehensive green transformation of agriculture and rural areas will achieve remarkable results. The "Plan" focuses on six tasks including energy conservation and emission reduction in the planting industry, emission reduction and carbon reduction in the livestock industry, fishery emission reduction and increase sinks, carbon sequestration expansion in farmland, energy conservation and emission reduction in agricultural machinery, and renewable energy substitution. It implements methane emission reduction in rice fields, chemical fertilizer reduction, etc. Ten major actions include increasing quantity and efficiency, supporting scientific and technological innovation, and building a monitoring system. [2]► The Ministry of Finance and other 7 departments: The "China Clean Development Mechanism Fund Management Measures" was revised and promulgated
html On June 28, the Ministry of Finance and other 7 departments revised and announced the "China Clean Development Mechanism Fund Management Measures", starting from August 2022 Effective from the 1st. The "Measures" moderately broadened the scope of use of the fund. On the basis of retaining the stipulation that the purpose of the fund is "supporting the country's response to climate change", it added "supporting carbon peak carbon neutrality, pollution prevention and ecological protection and other green and low-carbon activities" fields and promote high-quality economic and social development. At the same time, the "Measures" clarify that the fund will be used in a paid manner to support project activities that are conducive to achieving carbon peak carbon neutrality, generating benefits in addressing climate change, and implementing major national decisions and arrangements related to pollution prevention and ecological protection. The "Measures" have made three improvements to the fund's operating model and organizational structure: First, the fund's operating model has been modified from the current "according to the social fund model" to "operated according to the market-oriented model", and stipulated that the paid use of the fund relies on professional institutions carry out. The second is to modify the fund's organizational framework from the current "Fund Review Council and Fund Management Center" to "Fund Policy Steering Committee and Fund Management Center". The Fund Review Council is responsible for reviewing major business matters of the fund and is now responsible for the Fund Policy Steering Committee. Provide guidance on major matters related to fund development. The third is to stipulate that representatives from the Ministry of Finance, the Ministry of Ecology and Environment, and the National Development and Reform Commission serve as co-chairs of the Fund Policy Steering Committee and are responsible for convening and chairing meetings of the Fund Policy Steering Committee. [3]► Six departments including the Ministry of Industry and Information Technology: "Action Plan for Improving Industrial Energy Efficiency" to promote green and low-carbon development in key industries
On June 29, six departments including the Ministry of Industry and Information Technology released the "Action Plan for Improving Industrial Energy Efficiency". The "Plan" is divided into four parts, including guiding ideology, main goals, main tasks and safeguard measures. Its main goal is that by 2025, the energy efficiency of key industrial industries will be comprehensively improved, the energy efficiency of key areas such as data centers will be significantly improved, the proportion of green and low-carbon energy utilization will be significantly increased, energy-saving and efficiency-improving technology and equipment will be widely used, and standards, services and supervision systems will be gradually improved. , the value-added energy consumption of industrial units above designated size dropped by 13.5% compared with 2020. Making the best use of energy and putting efficiency first has become a common concept and common requirement among market entities and the public. Energy conservation and efficiency improvement have further become the green and low-carbon "first energy source" and the primary measure for reducing consumption and carbon emissions. At the same time, a series of specific goals are proposed based on the actual development of the industry. By 2025, the proportion of new high-efficiency and energy-saving motors will reach more than 70%, the proportion of new high-efficiency and energy-saving transformers will reach more than 80%, and the power utilization efficiency of newly built large and ultra-large data centers will be (PUE) is better than 1.3, and the proportion of electric energy in the industrial sector to terminal energy consumption reaches 30%. The "Plan" proposes to vigorously improve energy efficiency in key industries, continue to improve the energy efficiency of energy-using equipment systems, coordinate and improve the comprehensive energy efficiency of enterprise parks, orderly promote the low-carbon transformation of industrial energy use, actively promote the upgrading of digital energy efficiency, and continue to consolidate energy-saving and efficiency-improving industries. 7 key tasks including laying the foundation and accelerating the improvement of energy-saving and efficiency-improving systems and mechanisms.[4]
► Four departments including the Ministry of Ecology and Environment: " Yellow River Basin Ecological Environment Protection Plan" proposes synergistic effects of pollution reduction and carbon reduction
On June 28, four departments including the Ministry of Ecology and Environment released "Yellow River Basin Ecological Environment Protection Plan" 》, puts forward 7 key tasks. The first is to optimize the spatial layout and accelerate the green development of the industry; the second is to promote the overall planning of the three waters and manage and restore the water ecological environment; the third is to strengthen regional cooperation and achieve synergy in reducing pollution and carbon dioxide; the fourth is to Strengthen management, control and restoration to prevent soil and groundwater pollution; fifth, adhere to ecological priority and implement systematic protection and restoration; sixth, strengthen source control to effectively prevent major environmental risks; seventh, build a governance system and improve governance levels. In order to ensure the completion of the target tasks, the "Plan" also deployed eight types of key projects, namely water environment protection and treatment projects, air pollution control projects in key industries, clean heating renovation projects, mobile source pollution control projects, and soil and groundwater pollution control projects. , ecological protection and restoration projects, hazardous waste collection and disposal capacity improvement projects, and medical waste collection and disposal capacity improvement projects, etc. [5]
► Ministry of Finance and National Development and Reform Commission: "Notice on Implementing Phased Price Subsidies after International Oil Prices Hit the Regulatory Upper Limit"
On June 29, the Ministry of Finance and National Development and Reform Commission issued "On Doing a Good Job in Implementing Periodic Price Subsidies" Notice on the implementation of phased price subsidies after the international oil price reaches the upper limit of regulation》. The notice pointed out that when the price of crude oil in the international market is higher than the upper limit of refined oil price regulation stipulated by the state, the price of refined oil will no longer be raised in stages, and the central government will provide corresponding price subsidies to oil refining companies. The subsidy targets are refined oil production and operation enterprises that produce, process and import gasoline and diesel within the territory of the People's Republic of China, hereafter referred to as oil refining enterprises. When the price of crude oil in the international market is higher than the upper limit of refined oil price regulation stipulated by the state (US$130 per barrel), phased price subsidies will be implemented for oil refining companies. The duration of the policy will be temporarily controlled for two months. If the price of crude oil in the international market continues to rise, In view of the upper limit of price control of refined oil products stipulated by the state, relevant control policies will be clarified in advance. [6]
► National Development and Reform Commission and other four departments: "Special Rectification Action Plan for Enterprise-related Illegal Charges" to rectify power supply price violations
On June 28, the National Development and Reform Commission and other four departments released "Special Rectification Action Plan for Enterprise-related Illegal Charges" , proposing special rectification of illegal charging issues involving enterprises in the field of water, electricity and heating. Strengthen price supervision in the fields of water supply, electricity, gas and heating, inside and outside the red line, construction and installation, renovation, maintenance and repairs, focusing on rectification of non-implementation of government pricing and government-guided prices, use of monopoly status to pass on costs that should be borne by oneself, and self-determined standards Charging fees for self-installed projects, charging illegal fees for measuring devices and compulsory inspections, etc. Focus on rectifying issues such as unreasonable price increases and illegal price increases in non-grid direct power supply links. Investigate and punish repeated apportionment of charges to users in the name of electricity service fees, failure to implement the electricity price disclosure system, and failure to completely clear out unreasonable charges that have been collected. It is strictly forbidden to increase power supply prices beyond the maximum allowable increase stipulated in the policy. [7]
► Han Zheng: The symposium on the clean and efficient utilization of coal emphasized the need to ensure the quantity and price of coal.
html On June 28, Vice Premier Han Zheng chaired the symposium on the clean and efficient utilization of coal and made a speech, proposing that we should do a good job in ensuring the quantity and price of coal. The quantity and price of coal shall be guaranteed, the clean and efficient utilization of coal shall be vigorously promoted, and high-quality development that prioritizes ecology, green and low carbon shall be solidly promoted. Han Zheng pointed out that promoting the clean and efficient use of coal is an important way to promote the green and low-carbon transformation of energy and achieve the goal of carbon peak and carbon neutrality. It is necessary to keep the bottom line of energy security based on the basic national conditions of coal-dominated energy, give full play to the "ballast stone" role of coal, and contribute to stabilizing the macroeconomic environment, stabilizing prices and protecting people's livelihood. We must adhere to the combination of long-term and near-term, establish first and then break, respect the laws of the market, strengthen government regulation, establish a long-term mechanism conducive to sustainable development, and coordinate the clean and efficient utilization of coal.It is necessary to promote the coordinated development of coal power and renewable energy, fully mobilize the enthusiasm of local governments and enterprises, and promote coal power joint ventures and coal power and renewable energy joint ventures. It is necessary to strengthen supervision, management, inspection and accountability to ensure the performance of medium and long-term thermal coal contracts. We will do a solid job in ensuring energy supply during the summer peak, and effectively ensure the electricity consumption for people's livelihood and the normal production of enterprises. We must firmly adhere to the bottom line of production safety and resolutely curb the occurrence of major accidents. [8]►Beijing Municipal Ecological Environment Bureau: "Beijing's Low Carbon Pilot Work Plan during the 14th Five-Year Plan"
On June 29, the Beijing Municipal Ecological Environment Bureau released "Beijing's Low-Carbon Pilot Work Plan during the 14th Five-Year Plan" Carbon Pilot Work Plan》. The "Work Plan" proposes that by 2025, a number of advanced low-carbon technologies will be screened, a number of low-carbon front-runner enterprises and public institutions will be cultivated, a number of climate-friendly regions will be built, and a number of comprehensive climate investment and financing policy tools will be condensed and summarized. , to accumulate experience and provide support for the research and formulation of climate change mitigation and adaptation policies, regulations, and standards, and to provide a reference and replicable model for the whole society to practice low-carbon production and lifestyle. According to different pilot subjects and work content requirements, four types of pilot work will be carried out: advanced low-carbon technology pilots, low-carbon front-runner pilots, climate-friendly regional pilots, and climate investment and financing pilots. [9]
► Shanghai Municipal Development and Reform Commission and other four departments: "Implementation Plan on Strict Energy Efficiency Constraints to Promote Energy Conservation and Carbon Reduction in Key Areas of the City"
html On June 28, Shanghai Municipal Development and Reform Commission and other four departments issued "About Strict Energy Efficiency Constraints to Promote Energy Conservation and Carbon Reduction" Implementation plan for energy conservation and carbon reduction in key areas of our city》. The "Implementation Plan" proposes that by 2025, through the implementation of carbon peak actions in the industrial sector and energy conservation and carbon reduction actions in key industries, the energy consumption of Shanghai's industrial added value above designated size will decrease by 14% compared with 2020. Steel, cement, oil refining, ethylene The proportion of production capacity in key industries such as , , synthetic ammonia and has reached the benchmark level of more than 30%, and the proportion of data centers that has reached the benchmark level is about 60%. The overall energy efficiency level of the industry has been significantly improved, the carbon emission intensity has been significantly reduced, and the green and low-carbon development capabilities have been significantly enhanced. By 2030, the energy resource utilization efficiency, overall energy efficiency level and carbon emission intensity of Shanghai's key industries will reach the international advanced level, the proportion of production capacity that reaches the benchmark level will further increase, energy-saving and low-carbon technologies will make breakthrough progress, and green and low-carbon transformation and development will make significant progress. Effectiveness. [10]► Sichuan Provincial Department of Economics and Information Technology: "Sichuan Province's "14th Five-Year Plan" Industrial Green Development Plan"
html On June 29, Sichuan Provincial Department of Economy and Information Technology released "Sichuan Province's "14th Five-Year Plan" Industrial Green Development Plan Development Plan》. The "Plan" proposes that by 2025, significant results will be achieved in the green transformation of industrial production methods and industrial structures, green and low-carbon technology and equipment will be widely used, the level of energy resource utilization will be steadily improved, and the intensity of carbon emissions and pollutant emissions will be further reduced. In order to achieve the goals of 2030 Carbon peaked two years ago, laying a solid foundation. The energy utilization efficiency of and has been steadily improved, and the energy consumption of the added value of industrial units above designated size has dropped by 14%. Carbon emission intensity continues to decline, with carbon dioxide emissions per unit of industrial added value falling by 19.5%. The efficiency of resource utilization has been greatly improved. The water consumption of with an industrial added value of 50,000 yuan has dropped by 16% compared with 2020, and the comprehensive utilization rate of bulk industrial solid waste has reached 57%. The construction of the green manufacturing system is advanced in depth, striving to create 200 new green factories and 20 green parks, and cultivate 30 green and low-carbon parks and 60 green and low-carbon factories. [11]International Policy and Event Tracking
►The U.S. Supreme Court weakens the Environmental Protection Agency’s regulation of power plant emissions
On June 30, according to CNBC, the latest U.S. Supreme Court ruling restricted the Environmental Protection Agency from regulating climate change greenhouses for existing power plants. Gas emission standards power. Under a Supreme Court vote, only Congress has the power to create a broad system of cap-and-trade regulations to limit emissions from existing power plants. [12]
► The U.S. Department of Energy revise standards for the Civilian Nuclear Credit Program
On June 30, according to Reuters reported, the U.S. Department of Energy (DOE) announced that it would extend the deadline for applications and bids for the Civilian Nuclear Credit Program by two months.At the same time, the eligibility criteria for the civil nuclear credit program were revised, that is, nuclear reactors "cannot recover more than 50% of the costs from the cost of service regulations or regulated contracts", which may affect the reactor being awarded funding in the first round. qualifications. [13]
► EU carbon tariff passed the European Parliament vote
On June 22, according to the official website of the European Parliament, the European Parliament passed the establishment of the Carbon Border Adjustment Mechanism (CBAM) with 450 votes in favor, 115 votes against and 55 abstentions. Amendments to the draft. The proposal was originally scheduled for voting on June 8, but was canceled due to various reasons. The proposal passed this time is a revised version of the June 8 version. Compared with the more radical version to be voted on on June 8, the amendments passed this time have slightly milder provisions, mainly extending the transition period and the free quota exit time by two years. [14]
► British Power Grid launches 20.9 billion pound funding plan to increase grid capacity
On June 29, according to Reuters, the British energy regulator Ofgem approved a 20.9 billion pound spending plan that will be used to increase regional power grid capacity. , improve the power distribution network. The budget includes £2.7 billion in upfront funding, mainly for building new networks. In addition, Ofgem recommended reducing the company's equity cost provision to 4.75%. [15]
►The German cabinet passed a bill to allow the government to assist energy companies
html On July 5, according to Reuters, the German cabinet passed a bill to allow the government to assist struggling energy companies. The bill allows the German government to provide rescue packages including shareholdings and also introduces a mechanism to pass on part of the rising cost of natural gas to consumers. In addition, general price adjustment provisions may also be triggered if natural gas imports are significantly disrupted. The law will be voted on by the lower and upper houses of parliament on July 8. [16]► Germany plans to impose a natural gas tax on all consumers
html On July 1, according to Reuters, the German government plans to pass parliamentary legislation to impose a tax on all natural gas consumers to help suppliers cope with rapidly rising import prices. The German Bundestag is expected to decide on July 8 whether the tax bill will be passed. [17]► The Dutch government provides a subsidy of 169 million euros to replenish natural gas storage
On July 5, according to Reuters, the Dutch government provided a subsidy of 164 million euros to replenish the Bergermeer natural gas storage facility in the Netherlands. The subsidy program aims to fill 4.1 billion cubic meters of facilities 68% by October this year. [18]
►The Netherlands announced a 750 million euro national hydrogen network plan
html On June 29, according to Reuters, the Dutch government stated that it would invest 750 million euros to establish a national hydrogen transportation network by 2031. Dutch gas network operator Gasunie will manage and operate the network, part of which is due to be completed in 2026. [19]► Greece plans to cancel the electricity surcharge
html On June 25, according to Reuters, Greece plans to cancel the electricity surcharge levied by power companies as part of the government's efforts to mitigate the impact of rising energy costs on consumers. The policy is expected to last from August 2022 to July 2023. [20]► Australia’s spot power market is lifted from suspension
html On June 22, according to Reuters, the Australian Energy Market Monitor (AEMO) will lift the suspension of the spot power market in phases. Electricity production has returned to more normal conditions as some coal-fired generators restarted. The market suspension will be lifted in stages, and the market will be allowed to set prices again from 4 a.m. local time on June 23. AEMO will decide to officially cancel the market suspension after monitoring market conditions for at least 24 hours. [21]Hot "Carbon" Research: The EU Carbon Border Regulation Mechanism is Coming - What do you think? what to do? Is
CBAM really coming?
The latest progress in the EU’s promotion of CBAM
On June 22, 2022, the European Parliament voted to adopt an amendment to the draft establishing a Carbon Border Adjustment Mechanism (CBAM) [22].This means that this high-profile proposal is only the "last mile" away from final legislation. We expect that the European Commission, the European Parliament and the European Council will hold tripartite talks on this proposal in the second half of the year and finally pass it.
Chart: EU CBAM legislation timeline
Source: European Parliament official website, CICC Research Institute
The CBAM process has had twists and turns, highlighting the EU's determination to be net-zero. Since the European Commission proposed the legislative draft in July last year, the advancement process of CBAM has been described as "twisting and turbulent". Especially affected by factors such as global energy supply shortages and the Russia-Ukraine conflict, the content of the draft has also been controversial within the EU. In July last year, During the feedback period in November, a total of 194 feedbacks were received from various stakeholders within the EU [23]; on June 8 this year, the day when the European Parliament planned to vote and review, CBAM’s vote was recommended because the ETS bill was not passed. Cancellation, finally passed on June 22. Although the steps are difficult, whether it is the rapid revision of the bill and its passage, the EU carbon market's 2030 emission reduction target passed from 61% to 63%[24], or the subsequent June 28, led by Germany, The statement on the Climate Club issued at the G7 summit and the commitment to further accelerate the solution to the problem of carbon leakage from emission-intensive products[25] all demonstrate the EU's unshakable climate ambition. We have discussed the carbon border adjustment mechanism in "Carbon Policy China (12): The United States plans to require listed companies to disclose carbon emission-related information". This time, we will further analyze the latest progress of the mechanism and try to propose potential response suggestions.
What are the current uncertainties and their influencing factors?
According to the analysis of the EU legislative process and the passing rate of relevant bills from 2014 to 2019, the first reading pass rate of the CBAM bill is as high as nearly 90%[26]; according to the European Parliament’s announcement this year China and the EU will launch the "tripartite consultation" [27] between EU institutions to negotiate on the controversial points in the current CBAM plan and further eliminate obstacles in the formal legislative process in the future. Of course, considering the current reality of unprecedented inflationary pressure in Europe, the EU Council still has the possibility of making further adjustments to the exit schedule of free quotas for EU industries in CBAM, carbon cost refunds (tax rebates) for EU product exports, and the scope of CBAM taxation. . At present, we believe that there are three specific uncertainties:
) Whether the withdrawal time of free emission quotas for EU industries will be postponed.
) Whether the scope of CBAM taxable products will be expanded. Compared with the plan proposed by the European Commission in July 2021 (hereinafter referred to as the "European Commission Plan"), the scope of taxable products in the European Parliament plan includes chemicals and plastics. In addition, in the European Commission's plan, whether to expand the scope of taxed products in the future requires collecting relevant information before 2025 for judgment, while the European Parliament's plan not only requires the gradual inclusion of products currently controlled by ETS (mainly upstream high-energy-consuming industries) , also requires the inclusion of downstream products under the jurisdiction of CBAM, which greatly increases the coverage of CBAM taxable products, which will become another focus of the "tripartite consultation".
) Should EU export products enjoy carbon cost “tax rebates”? The European Parliament and the European Council agreed that the European Commission should assess the impact on export carbon leakage during the implementation of CBAM and focus on whether additional measures are needed to refund part of the carbon cost of EU export products, which reflects the internal EU industry. The industry is concerned that higher carbon costs will affect the export competitiveness of its products. However, this item was not included in last year's European Commission plan, and there is still some uncertainty as to whether this "tripartite consultation" can reach an agreement on this matter.
What do you think of the EU carbon border adjustment mechanism?
CBAM taxation implementation process
From the general process, a product exported to the EU to pay the carbon border adjustment tax needs to go through five links: registration, pre-purchase, declaration, settlement and liquidation. Among them, import companies within the EU bear the main payment task:
Chart: EU CBAM taxation implementation process
Source: European Parliament official website [28], CICC Research Institute
) Registration link: EU companies that import CBAM controlled products from outside the EU first need to register in the EU CBAM system to obtain qualifications .
) Pre-order link: CBAM voucher is paid once a year, and the price is updated once a week based on the actual operation of ETS. In order to prevent importers from concentrating on buying CBAM certificates at a certain time of the year, the EU requires importers to pre-purchase at least once a quarter, and each pre-purchased CBAM certificate covers at least 80% of the estimated emissions.
) Declaration link: has two ways to declare product carbon emission intensity. The importer reports the actual emissions of imported products to the CBAM management agency before settlement; or the exporter registers in the CBAM system on its own and submits the actual emissions of the products verified by a third-party agency.
) Settlement link: importers must pay the CBAM certificate for the previous year based on the actual emissions before the end of May each year. If there is no relevant data, the default emissions will be used.
) Liquidation link: The EU prohibits private trading of CBAM certificates. For the part where the total amount of pre-purchased certificates by the importer exceeds the actual required amount (that is, the remaining certificates), the EU will buy back the importer at the original price, but the total amount will not exceed The importer purchased one-third of the total number of vouchers in the previous year, and the remaining vouchers in the previous year will be cleared directly.
Carbon border adjustment tax accounting method
Carbon border adjustment tax essentially makes imported goods bear the same carbon cost as similar EU goods based on their carbon content. It mainly involves carbon emission accounting boundaries, carbon emission intensity standards and carbon tax price standards, etc. In terms of carbon emissions accounting, the basic calculation process is as follows:
Chart: EU carbon border adjustment tax calculation process
Source: European Parliament official website, CICC Research Institute
From the perspective of carbon emission accounting boundary, the carbon emissions implied by the European Parliament plan will increase. According to the European Parliament plan, the carbon emissions of imported products are mainly calculated from two parts, namely direct emissions and indirect emissions. Direct emissions refer to the emissions produced in the production process directly controlled by the producer of a product, including emissions from the cooling and heating processes; indirect emissions refer to the emissions from the electricity used in the production process of a product. Compared with previous versions, this European Parliament plan also incorporates emissions from electricity used in product production into the accounting system, which will result in the calculated embodied carbon emissions of products being higher than in previous versions.
From the perspective of product carbon emission intensity standards, the European Parliament’s plan is more stringent. The EU encourages importers to declare based on actual emission intensity. However, if the importer fails to declare, or cannot fully determine the reliability of the actual declared emission intensity, the default emission intensity will be used. In the European Parliament's plan, the default carbon intensity is the average carbon intensity of the bottom 10% of the carbon emission levels of similar product manufacturers in the exporting country. If the country does not have the above data, the average carbon intensity of the last 5% of the carbon emission levels of similar product manufacturers in the EU will be used. In comparison, the standards of the previous European Commission plan are more relaxed. The default carbon emission intensity will be the average emission intensity of similar product manufacturers in the exporting country. If the country does not have the above data, the reciprocal carbon emission level of similar product manufacturers in the EU will be used. 10% average carbon intensity.
From the perspective of carbon tax price collection standards, although the European Parliament’s plan postpones the start time of CBAM and compromises the withdrawal time of free carbon quotas compared to the European Parliament’s proposed voting plan on June 8, there is still a transition period for the gradual withdrawal of free quotas. somewhat shortened. Because goods exported to the EU will also receive the same free quotas as EU industries, the time and rhythm of the withdrawal of free carbon quotas will be crucial to the collection of carbon taxes.In this European Parliament plan, although the start of withdrawal is delayed by one year, the complete withdrawal time is three years earlier than the European Commission plan, which means that the pace of withdrawal will be accelerated, and for enterprises, it will actually leave a buffer Time is more limited.
Chart: Comparison of the differences in carbon border adjustment tax accounting between different plans
Source: European Parliament official website, CICC Research Institute
Analysis of the potential impact on Chinese companies
First, from the perspective of product taxation scope, the new plan is subject to The affected Sino-European trade volume will increase significantly, and the potential impact on my country's mid-stream and downstream enterprises will increase.
Compared with the European Commission plan passed last year, the "first reading" plan passed by the European Parliament this time expanded the scope of controlled products, adding chemicals and plastics industries to the original steel, aluminum, fertilizer and cement industries. , and expanded the scope of products included in the cement industry to include bauxite cement. According to 2021 trade data released by Eurostat, the EU's annual imports from China are 472 billion euros, accounting for 24.7% of the EU's total imports. If calculated in accordance with the newly determined scope of products subject to CBAM levy in the European Parliament's plan (excluding mid- and downstream complex products), the EU import volume of affected by CBAM from China will increase by 5.47 times from the European Commission's plan of 5.289 billion euros to 342.54 billion euros, accounting for 7.2% of the total trade volume between China and Europe.
Chart: Comparison of trade volume of affected industries between China and Europe under different plans
Source: Eurostat [29], CICC Research Institute
Note: 1) Unit is 100 million euros
In addition to the industries mentioned above, the existing midstream and downstream industries Whether the manufacturing industry will be affected has always been one of the focus issues on the scope of CBAM tax products. According to the European Parliament plan, the EU will introduce a timetable for expanding the product range before the end of June 2025, giving priority to industries with high carbon leakage risks and carbon emission intensity, and will join the current CBAM controlled products before the end of 2025. Downstream products, that is, existing midstream and downstream manufacturing products will be included in the taxation system before the official launch of CBAM in 2027. Although the list of midstream and downstream taxed products and specific implementation details have not been announced this time, according to the European Parliament’s plan, we believe that it will be more detrimental to my country’s midstream and downstream industries. On the one hand, the European Parliament's plan clearly includes the carbon emissions of intermediate inputs of complex products. refers to the calculation of implicit carbon emissions for complex commodities (mostly mid- and downstream manufacturing products in existing industries). This plan clearly considers not only direct emissions. , and incorporates carbon emissions from intermediate inputs used to manufacture complex goods. On the other hand, affected by the industrial structure and energy structure, the carbon emissions of intermediate products in my country's mid- and downstream industries account for a relatively high proportion. Taking the automobile industry as an example, the carbon emissions generated by my country's automobile assembly process are basically the same as those of other countries, or even slightly less. However, after considering the carbon emissions in the production process of intermediate inputs, the overall carbon emissions of my country's automobiles will increase significantly [30 ].
Chart: Proportion of carbon emissions from intermediate inputs in the automobile industry in different countries (2007)
Source: Energy demand and greenhouse gas emissions during the production of a passenger car in China30, CICC Research Institute
Second, Central and European carbon intensity reference Looking at the differences in standards, my country still has certain gaps in the values of some parameters, which may cause the relevant accounting results of enterprises to fail to pass EU CBAM certification.
The accounting of carbon emissions is directly related to the final amount of taxes paid by an enterprise, among which the accounting standard of carbon emission intensity is the key.Comparing the EU standards (EU ETS emission accounting standards) [31] and the carbon emission accounting standards issued by the China Standards Committee, the Ministry of Ecology and Environment, and the National Development and Reform Commission [32], is similar to relevant Chinese and European standards in terms of accounting boundaries and greenhouse gas ranges. And some regulations are more stringent in China. For example, China includes methane in the assessment scope; , but when it comes to specific accounting details and parameter settings, there are big differences between Chinese standards and EU standards. usually calculates carbon emissions according to Chinese standards. The intensity will be less than the EU standard. Take the electrolytic aluminum industry as an example:
Chart: The carbon emission intensity of the electrolytic aluminum industry reflects the difference between the Chinese and European reference standards
Source: European Commission, IPCC[33], National Development and Reform Commission, CICC Research Institute
Therefore, a On the one hand, it is necessary to promote the integration of my country's relevant standards with international standards such as IPCC and reduce the risks caused by different accounting standards for Chinese companies in the process of "going global"; on the other hand, Chinese companies should face up to the differences in relevant standards between China and Europe and make preparations in advance. Strictly calculate the carbon emission intensity of its products in accordance with EU standards to promote emission reduction while avoiding unnecessary losses due to violations of CBAM rules.
Third, the EU’s free carbon quota withdrawal time and pace seem to have been relaxed, but in fact the transformation window left for Chinese companies may be shortened.
The unit carbon tax standard is another key factor that affects the final amount of tax paid by enterprises. Among them, the carbon price difference and the free quota ratio between the exporting country and the EU are the main determining factors (as shown in the figure below). Since there is great uncertainty in the carbon price forecast, this report mainly focuses on the impact of the withdrawal time and intensity of free quotas on the unit tax price. Its impact on the carbon tax price standards that companies need to pay is as follows:
Assume that the basic carbon prices of my country and the EU are equal. The average carbon market price in 2021 is adopted and remains unchanged, that is, the EU: 56.8 euros/ton and China: 7.7 euros/ton. The European Commission plan stipulates that the free quota will be withdrawn at a rate of 10% per year in 2026 until it is completely withdrawn in 2035. The European Parliament plan stipulates that the withdrawal will begin in 2027, and the annual free quotas will be: 93% in 2027, 84% in 2028, 69% in 2029, 50% in 2030, 25% in 2031, and complete withdrawal in 2032. Before the formal implementation of CBAM and the complete withdrawal of free quotas (i.e. 2026-2035), the change trend of unit carbon tax price under the two plans is shown in the figure below.
Chart: Considering the impact of free carbon quotas on carbon tax price trends under different plans
Sources: European Commission, IPCC[34], National Development and Reform Commission, CICC Research Institute
Chart: Comparison of carbon emission intensity of the steel industry in China, the United States and Europe in 2020
Data Source: European Commission, CICC Research Institute
In comparison, although the European Parliament plan is officially implemented one year later, its transition period is short, and the subsequent unit carbon tax price rises significantly faster than the European Commission plan; the two plans in 2030 The price of unit carbon tax remains basically the same. In fact, if subsequent price fluctuations in the China-EU carbon markets are taken into account, the carbon price gap between the two countries is likely to widen further, especially in the near to medium term. Therefore, the transition period for the formal implementation of CBAM and the first few years before free quotas begin to be phased out will leave a certain window of time for Chinese enterprises to accelerate their green transformation.
Fourth, compared with the actual carbon emission levels of similar products in the EU, the average level of Chinese companies is higher, but there is uncertainty when compared with similar backward companies.
Because CBAM’s calculation of carbon emission intensity will use the default intensity calculation when the company cannot provide credible actual emission data, which is directly related to the average emission level of the industry in which the same product is located in China and Europe.
According to CICC Research Institute’s calculations, in 2019, the full life cycle carbon emission intensity of products in various departments in mainland China was generally about 2 to 4 times that of products in the same industry in the EU. Among them, for traditional energy-intensive and resource-intensive industries such as electricity (6.76 kg/USD), non-metallic mineral products (3.00 kg/USD), and metal products (1.82 kg/USD), the emission intensity of mainland China products is the EU 3.3 times, 2.4 times, and 4 times the level [35].
The European Union has also measured the carbon emission intensity of Chinese and European products. According to its official report [36], taking steel as an example, the carbon emission intensity of China's two technical route products in 2020 is significantly higher than that of EU companies. Among them, electric furnace steelmaking technology The carbon emission intensity of China is much higher than that of the EU and other countries. The carbon emission intensity of blast furnace steelmaking technology is higher than that of the EU but roughly the same as that of the United States.
Taken together, the average carbon emission intensity of Chinese enterprises is significantly higher than the average carbon emission intensity of the EU. However, based on this, we can judge whether the average level of the bottom 5% of companies in the EU is higher or lower than the average level of the bottom 10% of Chinese companies. There is still great uncertainty in which default value is more beneficial to Chinese companies. How does
respond to the EU carbon border adjustment mechanism?
How should affected companies respond?
For high-energy-consuming enterprises with a large share of domestic exports to the EU, due to the large carbon price difference between domestic and EU, carbon costs will inevitably increase after the implementation of the carbon tariff mechanism, and there is a risk of profit squeeze. At the same time, if emission intensity is significantly higher than the industry average, high carbon costs may lead to lower demand and reduced exports. Domestic energy-intensive enterprises with large export exposure can prepare countermeasures from the following aspects:
) Pay attention to adapting to EU rules and improve the carbon emission monitoring and accounting system. During the policy transition period (2023~2025 or 2023~2026), although actual taxation will not begin, carbon emission declarations will begin in advance. Importers need to declare the total import volume of the quarter on a quarterly basis. Direct and indirect emissions of products will be in the original amount. The carbon price corresponding to the producing country, etc. In terms of carbon emission accounting, if the imported products can provide emission level certification, the EU will tax based on the verified actual emission level. If the emission level certification cannot be provided, the default value will be calculated, and the default value must be higher than actual emission levels. Therefore, under the carbon border adjustment mechanism, carbon emission data is the tax base for future carbon tariffs, and companies that can provide actual emission certificates have a competitive advantage. It is recommended that export enterprises need to establish and improve carbon emission monitoring and accounting systems as soon as possible to form the ability to independently provide product carbon footprint data. Strive for corresponding carbon tariff deductions and provide a reliable basis for any disputes over emission data that may arise in the implementation of carbon tariffs in the future. In specific operations, on the one hand, according to the enterprise's own affordability, greenhouse gas monitoring equipment can be installed in each link of production as appropriate to increase the transparency and reliability of measured carbon emissions, establish a unified carbon emissions database, and improve carbon data supervision and storage. management and environmental modeling; on the other hand, we can pay attention to the progress of international carbon emission accounting methods and promote mutual recognition of accounting and assessment methods with foreign countries.
) Take the initiative to communicate with import manufacturers and open up channels for mutual recognition of carbon emissions. The CBAM proposal has a third-party verification mechanism. Importers should ensure that the declared emissions have been verified by a recognized verification agency. Therefore, exporters need to communicate and negotiate with different importers respectively about carbon data verification responsibilities, and obtain the verification results from the importer. recognition, which increases the cost of communication and mutual recognition. In practice, the proposal also provides a more convenient mutual recognition channel for exporters, stipulating that they can apply for registration with the CBAM authority, and then have their products included in the European Commission's unified database after verification by a third-party verification agency. Within five years, During the validity period, any importer in the EU can directly use the verified information in the unified database. Before CBAM is officially implemented, companies can proactively negotiate with different importers in advance on the accounting and accounting methods of carbon emission data, or plan to register through official channels to reduce communication costs.
) During the policy transition period, optimize the energy consumption structure through technological upgrades and reduce carbon emission intensity. After the implementation of the carbon tariff, it is inevitable that the environmental costs of corporate operations will increase. The transition period can be used to build an internal carbon pricing system and incorporate environmental cost considerations into the core business operations and investment decisions. On the one hand, energy efficiency can be improved through technological upgrading to avoid higher cost increments and weakening market competitiveness due to lower carbon emission intensity than the industry average; on the other hand, carbon emissions can be reduced by optimizing the energy consumption structure. For enterprises with high technical level and limited room for energy efficiency improvement, it is recommended to reduce direct and indirect carbon emission intensity by optimizing the energy consumption structure, especially increasing the proportion of green electricity in the electricity consumption structure.For example, in the electrolytic aluminum industry, most carbon emissions in production come from indirect emissions from electricity use. If green electricity is used to replace coal power, the carbon emission intensity will be significantly reduced. For enterprises with larger plant areas, more stable operations, and the ability to install rooftop photovoltaics, they can consider building their own rooftop photovoltaics and consuming green electricity through self-consumption. The cost of electricity consumption is lower than that of grid electricity, and at the same time, the cost of export carbon can be significantly reduced. If you do not have the conditions to build your own rooftop photovoltaics, you can consider trading green electricity and green certificates to directly offset the company's actual emissions and obtain corresponding environmental rights.
) Make plans to diversify exports in advance and stabilize the fundamentals of foreign trade. If after a company upgrades its technology to improve energy efficiency and optimize its energy consumption structure, due to the carbon price gap between China and Europe, the carbon tariff tax base is still large, and the increased carbon costs are difficult to pass on to EU users, then exports to the EU will be negatively impacted. Influence. Export-oriented companies should actively build a diversified trade development strategy, expand new markets and new customers around the world, especially increase the share of exports to emerging economies, and make up for the possible decline in exports to Europe. If necessary, we can consider increasing foreign direct investment based on our own strength and alleviate pressure through trade diversion and other methods.
How should investors respond? Related investment suggestions
For investors in related fields, they can pay attention to the changes in the industry competition pattern after the increase in corporate carbon costs, the increase in the investment value of clean energy operators after the appreciation of environmental rights, and the opportunities in the carbon monitoring and evaluation segment driven by companies' response to carbon tariff rules. :
) The differentiation or acceleration of energy-intensive industries will benefit technology leaders. In response to the EU carbon tariff policy, domestic carbon pricing policies for high-energy-consuming industries may be accelerated, and carbon prices may increase compared to the current level. Against the background of high carbon costs at home and abroad, powerful leading companies have further reduced their carbon emission intensity through technological upgrading and expanded their competitive advantages. At the same time, leading companies have strong bargaining power and are more advantageous in transmitting cost increases downstream. Therefore, leading companies in high-energy-consuming industries included in the scope of carbon tariffs are expected to take this opportunity to further upgrade their technologies and gain more market share, accelerating the elimination of small and medium-sized enterprises.
) New energy operators and upstream equipment suppliers benefit from the increased value of environmental rights and interests. In order to reduce carbon emission intensity, high energy-consuming enterprises have increased demand for clean energy consumption and increased the value of various environmental rights and interests. As providers of environmental rights and interests, new energy operators’ income (green power premium) is expected to further increase. At the same time, the demand for rooftop photovoltaic industrial and commercial projects has increased, and new energy upstream equipment manufacturing companies and supporting construction companies, such as photovoltaic component manufacturers and installers, have benefited.
) The demand for carbon monitoring and accounting services is increasing. At present, domestic manufacturers generally have little experience in carbon monitoring, accounting and evaluation. In order to cope with future carbon tariff requirements, the demand for corporate layout monitoring and accounting systems will increase significantly. Carbon monitoring equipment manufacturers, accounting and solution providers will benefit during this period.
Carbon neutrality related industry and corporate trends
This chapter will be based on the analysis and forecasts of various industry groups of CICC Research Department, tracking the theme trends in the "dual carbon" field from both industry and corporate levels, and helping investors seize "carbon neutrality" bring investment opportunities while avoiding related risks.
Carbon neutral transformation industry dynamics tracking
Chart: Industry policy tracking
Source: Wind, government websites such as the National Development and Reform Commission and the Ministry of Industry and Information Technology, CICC Research
Coal industry
► National Bureau of Statistics: National coal mining and The washing and separation industry achieved a profit of 448.9 billion yuan, a year-on-year increase of 175%
National Bureau of Statistics profit data of industrial enterprises above designated size from January to May showed that industrial enterprises above designated size achieved operating income of 53.16 trillion yuan, a year-on-year increase of 9.1%. Mining business revenue was 2,748.29 billion yuan, a year-on-year increase of 41.3%. Among them, the coal mining and washing industry achieved main business income of 1,657.06 billion yuan, a year-on-year increase of 60.8%.[37]
► Guangzhou City is stepping up its efforts to promote the implementation of energy projects and strive for a new batch of clean coal power projects to comply with the regulations.
html On June 23, the Guangzhou Municipal People's Government issued the "Guangzhou City Implements the State Council's "Package of Policies and Measures to Solidly Stabilize the Economy" Notice of the Implementation Plan. The notice proposes to speed up the implementation of a number of energy projects. Accelerate the construction of a number of backbone power grid projects, complete and put into operation the Guangdong Huadu natural gas cogeneration project and the Guangdong Power Grid DC back-to-back Guangzhou project, adding 920,000 kilowatts of backbone power grid installed capacity. Coordinate and promote the construction of "gas-replacing coal" natural gas heat, power and cooling cogeneration projects in the eastern district of Guangzhou Development Zone, and the second phase backbone power supply of the Zhujiang LNG power plant; start the construction of the "gas-replacing coal" power supply project of Huangpu Power Plant; accelerate the implementation of Baiyun Hengyun natural gas power generation, Conghua University Tang gas power generation and other power supply project construction land will be used to promote the construction of gas supply pipelines for power supply projects. [38]Steel industry
► Six departments including the Ministry of Industry and Information Technology: By 2025, the energy efficiency of products in steel and other industries will reach international levels
Six departments including the Ministry of Industry and Information Technology issued an action plan to improve industrial energy efficiency. By 2025, the energy efficiency of key industrial industries will be comprehensively improved, the energy efficiency of key areas such as data centers will be significantly improved, the proportion of green and low-carbon energy utilization will be significantly increased, energy-saving and efficiency-improving technology and equipment will be widely used, standards, services and supervision systems will be gradually improved, steel, petrochemicals, etc. The energy efficiency of key products in the chemical industry, nonferrous metals, building materials and other industries has reached the international advanced level, and the energy consumption of the added value of industrial units above designated size has dropped by 13.5% compared with 2020. Making the best use of energy and putting efficiency first has become a common concept and common requirement among market entities and the public. Energy conservation and efficiency improvement have further become the green and low-carbon "first energy source" and the primary measure for reducing consumption and carbon emissions. [39]
► China’s net exports of stainless steel increased by 80% month-on-month in May, hitting a new high since the beginning of the year.
The General Administration of Customs released statistics on my country’s stainless steel import and export in May. In May, domestic net exports of stainless steel were 256,900 tons, a month-on-month increase of 114,200 tons, an increase of 80%; a year-on-year increase of 193,400 tons, an increase of 304.5%, setting a new high for net exports since the beginning of this year. From January to May, the total domestic net export volume of stainless steel was 516,900 tons, a year-on-year decrease of 21,100 tons, or 3.92%. [40]
Non-ferrous industry
►Ministry of Industry and Information Technology: Currently, lithium resources are still running at a high level, and we will do a good job in guaranteeing power battery resources and materials from three aspects
The deputy director of the Equipment Industry Department of the Ministry of Industry and Information Technology said that currently lithium resources are still running at a high level, and at the same time Raw materials such as cobalt, nickel and petroleum coke used in graphite anodes have also increased significantly in price, putting great pressure on the production and operation of enterprises. In the next step, the Ministry of Industry and Information Technology will do a good job in ensuring the supply of power battery resources and materials from three aspects: first, to guide upstream and downstream enterprises to strengthen the connection between supply and demand, establish stable cooperative relationships through signing long-term agreements, etc., and coordinate to deal with the risks of resource supply and price fluctuations; second, to accelerate Promote the development and utilization of domestic resources, guide local authorities to ensure the production factors of relevant enterprises, continue to improve domestic resource supply levels, and support leading enterprises to jointly develop overseas resources in accordance with international rules; third, promote the comprehensive utilization of renewable resources, study and formulate lithium, etc. Renewable raw material standards, improve the power battery recycling system, and promote the recycling of more recyclable resources. [41]
Carbon-neutral growth industry
"Dual Carbon" Index Performance Review
The dual carbon index continues to pick up, and industry scale growth and demand expansion are gradually realized. As policies to stabilize growth are gradually implemented and the short-term impact of the epidemic gradually subsides, the low-carbon industry index and related industries continue to rebound, and industrial chains such as photovoltaics and new energy maintain prosperity. In the past two weeks (June 22 to July 5), the CICC Low Carbon Industry Index rose 8.6%, higher than the CSI 300 Index (3.9%) and the Hang Seng Index (1.3%). Since the beginning of 2022, the low-carbon industry index has increased by 1.6%, outperforming the CSI 300 and Hang Seng Index by 10.6ppt and 8.3ppt respectively.
Carbon neutrality-related industries continued to rebound after continuous corrections, with energy storage, power batteries and new energy vehicle sectors leading the gains. In terms of industries, the carbon neutrality-related growth industry index has increased overall in the past two weeks.Recently, energy storage projects reaching 1GW have been launched in many places, and domestic installed capacity is expected to accelerate in the second half of the year. At the same time, the National Energy Administration has emphasized the safety requirements of electrochemical energy storage power stations, and the energy storage concept led the market, with an increase of 9.9%. The concept of all-vanadium flow batteries, which benefited from the energy storage segment, led the gains, with power batteries rising by 9.0%. At the same time, thanks to the recovery of the supply chain and the stimulation of automobile consumption policies, the new energy vehicle industry chain maintained high prosperity, with new energy vehicles increasing by 7.5%.
Chart: Carbon neutrality concept index trend in the past two weeks
Source: Wind, CICC Research Department Note: Data as of July 5, 2022
Chart: Carbon neutrality related industry index rise and fall in the past 2 weeks
Data Source: Wind, CICC Research Note: Data as of July 5, 2022
Photovoltaic industry chain
Photovoltaic industry chain prices are rising. As of July 5, the photovoltaic managers' industry-wide index increased by 2.3% from two weeks ago, with the upstream and midstream manufacturing and downstream power plants rising by 2.6% and 1.0% respectively. In terms of price, the comprehensive price index of the photovoltaic industry increased by 2.9% compared with two weeks ago. Among them, the price index of polysilicon and silicon wafers increased significantly, rising by 7.1% and 3.6% respectively. The price index of cells and modules increased by 0.6% and 0.2% respectively.
Overseas market demand may stabilize at a high level, the efficiency of the domestic photovoltaic industry continues to improve, and the domestic industry accounts for a far leading share of the world. The European Union has proposed special photovoltaic goals and action plans [42], which has driven the rapid increase in energy storage capacity. Coupled with the continued strong demand for distributed energy in the United States, the high-speed growth overseas is expected to be maintained. Domestically, the concentration of silicon materials and silicon wafers in the middle and upper reaches of the photovoltaic industry chain continues to increase, and the middle and lower reaches continue to apply new technologies to improve efficiency. Coupled with the strong demand for many projects in the Chinese market, we are optimistic that the profitability of Chinese companies will be restored.
Chart: Photovoltaic managers index
Source: Wind, CICC Research
Chart: Photovoltaic industry comprehensive price index
Source: Wind, CICC Research
New energy industry chain
html New energy vehicles continued to recover strongly in June , the delivery volume of many car companies hit record highs. Xiaopeng delivered 15,295 vehicles in June, a year-on-year increase of 133%; Ideal delivered 13,024 vehicles in June, a year-on-year increase of 69%; Weilai delivered 12,961 vehicles in June, a monthly high, a year-on-year increase of 60%; BYD's new energy vehicle sales in June 134,000 vehicles, a new monthly sales high, a year-on-year increase of 224%, among which the sales of pure electric models increased significantly, with a month-on-month increase of 30%. Overall, with the orderly advancement of the resumption of work and production, sales of new energy vehicles continued to increase year-on-year in June, and the demand side has strong resilience.
Seven departments in Beijing issued a consumption plan to encourage car replacement and subsidize the replacement of passenger cars with new energy sources. On June 26, 7 departments including the Beijing Municipal Bureau of Commerce issued the "Beijing Plan on Encouraging Automobile Upgrading and Renewal Consumption", which proposed that between 0:00 on June 1, 2022 and 24:00 on December 31, 2022, scrap or transfer out of new energy vehicles Passenger cars or other passenger cars that have been used for 1 to 6 years can enjoy a subsidy of 8,000 yuan; scrapped or transferred out other passenger cars that are more than 6 years old (inclusive) can enjoy a subsidy of 10,000 yuan. Among them, the subsidy conditions must be met. The natural person owner scraps or transfers the passenger car registered in his or her name for more than 1 year in this city, and purchases a new new energy passenger car from a Beijing automobile sales enterprise and issues a "Unified Motor Vehicle Sales Invoice" , and complete the registration procedures for newly purchased new energy passenger cars before February 28, 2023. [43] We believe that policy subsidies can optimize the automobile structure in Beijing and promote the growth of automobile consumption. We are optimistic that the penetration rate of new energy vehicles will further increase.
Chart: Forecast of industry trends
Source: China Expo, CICC Research
Corporate “dual carbon” action
Chart: State-owned and central enterprises’ “dual carbon” action tracking
Source: Wind, company official website, CICC Research
Sustainable finance and ESG
Green credit, green bonds, green stock index and other products, as well as green development funds, green insurance, carbon finance and other financial instruments have played a crucial role in promoting the "internalization" of the externalities of economic activities.
Green Bonds
China’s green bond stock is approximately 1.67 trillion yuan. According to Wind data, as of July 6, 2022, there are 1,516 labeled green bonds in China, with an inventory size of 1.67 trillion yuan. In terms of issuance pace, a total of 49 new green bonds were issued in June, with an issuance scale of RMB 61.19 billion, a year-on-year decrease of 15.1% from the issuance scale of RMB 72.06 billion in May. Since the beginning of July, 13 green bonds have been issued, with a scale of RMB 5.10 billion.
The stock of carbon-neutral bonds is 163.6 billion yuan, accounting for 9.8% of the total balance of green bonds. As of July 6, 2022, there are 130 domestic carbon-neutral bonds in stock, with an inventory scale of 163.6 billion yuan, accounting for 9.8% of the total balance of green bonds. A total of 6 new carbon-neutral bonds were issued in June, with an issuance scale of 11.41 billion yuan, a year-on-year decrease of 24.2% from the 15.05 billion yuan issuance scale in May. The investment areas are mainly power, transportation and diversified financial industries.
Chart: China’s domestic labeled green bond stock size
Source: Wind, CICC Research Note: Data as of July 6, 2022
Chart: China’s domestic labeled green bond issuance rhythm
Source: Wind, China Note from the Research Department of Gold Company: Data as of July 6, 2022
Carbon market dynamics
The trading activity of the national carbon market is the same as in the previous period, and Beijing’s carbon price is showing an upward trend. As of July 4, 2022, the closing price of the national carbon market was 59 yuan per ton, which was basically the same as the closing price of 60 yuan per ton two weeks ago (June 22, 2022). A total of 845,000 tons were traded in the national carbon market, with a total transaction value of 48.85 million yuan. In the second quarter of 2022, the national carbon market price continued to fluctuate within a narrow range of 59 yuan per ton, and the total transaction volume of 4.48 million tons was relatively sluggish. In terms of local carbon markets, carbon prices in places such as Chongqing, Shanghai and Fujian have weakened. Carbon prices in Beijing showed an upward trend, closing at 85.2 yuan per ton on July 4, an increase of 20% from 71 yuan per ton on June 21.
EU carbon market reform will drive up carbon prices. The EU carbon price has fluctuated at a high of 85 euros per ton in the past two weeks. The closing price on July 4 was 84.16 euros per ton, an increase of 3.4% from two weeks ago (June 22). On June 22, the EU carbon market reform plan was passed in the second vote of the European Parliament22, which involves the access restriction policy for investors, but the policy does not involve the derivatives (futures and options) market, so the carbon There was a mild sell-off in the market, with carbon prices falling to €81.42/ton. But then carbon prices began to cover again as hedging demand re-emerged after options expired. From June 27 to July 1, the EU carbon market “Fit for 55” reform plan was officially passed by the European Parliament [44]. Carbon market investors continued to buy steadily, pushing the carbon price to nearly 90 euros/ tons level.
Chart: National carbon market carbon emission quota transaction price and volume
Source: Wind, CICC Research Note: Data as of July 5, 2022
Chart: China and EU carbon market price trends
Source: Wind , CICC Research Department Note: Data as of July 5, 2022
Chart: Average transaction price of China’s 7 provincial and municipal pilot markets for carbon emissions trading
Source: Wind, CICC Research Department Note: Data as of July 2022
ESG event tracking on June 5
Domestic: Build a digital government and promote the realization of dual carbon goals
►The central bank will continue to promote international cooperation in green finance through multilateral and bilateral platforms
On June 27, Yi Gang, governor of the People's Bank of China, said in an exclusive interview that the central bank can play a role in the green transition. In terms of monetary policy, the first and most important responsibility of the central bank is to maintain price stability. However, the central bank still has policy space to promote green transformation through structural monetary policy. As of March 2022, China's green loan balance has exceeded 18 trillion yuan, growing rapidly. The balance of green bonds in China is approximately 1.3 trillion yuan, ranking among the top in the world. In the next step, the People's Bank of China will continue to promote international cooperation in green finance through multilateral and bilateral platforms to better serve the goals of carbon peaking and carbon neutrality.
► Build a digital government and promote the realization of dual carbon goals
html On June 23, the State Council issued the "Guiding Opinions on Strengthening the Construction of Digital Government", which will proactively comply with the trend of economic and social digital transformation, fully release the dividends of digital development, and comprehensively create a new era of digital government construction. Make arrangements for the situation. The "Opinions" pointed out that promoting green and low-carbon transformation. Accelerate the construction of a carbon emission intelligent monitoring and dynamic accounting system, promote the formation of a new green and low-carbon development pattern of intensive conservation, recycling, efficiency, and inclusive sharing, and serve to ensure the smooth realization of carbon peak and carbon neutral goals.► Seven departments revised the "China Clean Development Mechanism Fund Management Measures": expanding support for carbon peak and carbon neutrality
html On June 28, seven departments including the Ministry of Finance and the Ministry of Ecology and Environment revised and announced the "China Clean Development Mechanism Fund Management Measures" (hereinafter referred to as the "Measures") will come into effect on August 1, 2022. This "Measures" moderately broadens the scope of use of the fund. On the basis of retaining the stipulation that the purpose of the fund is "supporting the country's response to climate change", it also adds "supporting green and low-carbon activities such as carbon peak carbon neutrality, pollution prevention and ecological protection, etc." fields and promote high-quality economic and social development.►ESG Global Leaders Summit discusses green finance, technological innovation and other ESG hot topics
The second ESG Global Leaders Summit, guided by the Department of Climate Change Response of the Ministry of Ecology and Environment and co-organized by CITIC Publishing Group, will be held from June 28, 2022 to It was held online on the 30th, with the theme focusing on "jointly promoting global ESG development and building a sustainable future." A number of financial experts expressed their opinions on topics such as "Difficulties and Challenges of Breaking Responsible Investment" and "ESG Helps Achieve the 30·60 Dual Carbon Targets", and discussed hot topics related to financial institutions' ESG, green finance, technological innovation and other related hot topics.
► "General Principles for Corporate ESG Information Disclosure" and "General Principles for Corporate ESG Evaluation" were released
On June 25, two group standards, "General Principles for Corporate ESG Information Disclosure" and "General Principles for Corporate ESG Evaluation" were officially released and will be launched on June 26, 2022. It will be officially implemented from now on. The two "General Principles" have the four characteristics of adhering to goal orientation, Chinese characteristics, inclusiveness, and reform and innovation. Their more important value lies in their future application in economic and social development. They are the key to my country's construction of an ESG standard system and the creation of a market-oriented, legal-based, The first step to an international business environment.
►Shanghai Environment Exchange takes the lead in building the "EATNS" carbon management system to help companies adapt to the carbon market.
html On June 24, the EATNS Carbon Management System Expert Committee and Assessment Working Committee were officially established in Shanghai. EATNS carbon management system is the world's first comprehensive carbon management system standard led by Shanghai Environment and Energy Exchange. Next, the assessment working committee will further improve the EATNS carbon management system segmented industry standards, actively serve the national "double carbon" goal and the high-quality development of the national carbon market; promote the internationalization of the EATNS carbon management system standard, and provide support services for the international trade of enterprises. ; Deepen the implementation of the EATNS carbon management system assessment work and strengthen the management of the standard implementation and assessment process.► Shanghai Pudong will establish corporate and personal carbon accounts
"Several Provisions on the Development of Green Finance in Pudong New Area, Shanghai" was adopted at the 41st meeting of the Standing Committee of the 15th Shanghai People's Congress and will be effective on July 1, 2022 Be implemented. The People's Government of Pudong New Area should rely on the green financial data service special library to carry out digital collaboration with various third-party institutions, explore the establishment of corporate carbon accounts and natural person (permanent population) carbon accounts, and integrate corporate carbon emission performance information and personal green and low-carbon activity information Incorporate into carbon accounts and form carbon points.
International: The EU carbon tariff vote finally passed
►IMF President: The common global goal should include carbon neutrality and sustainable development
The President of the International Monetary Fund (IMF) attended the second ESG Global Leaders Summit, in "Sustainability The IMF sent a congratulatory letter during the "Global Opportunities and Challenges for Development" session, stating that the IMF welcomes China to improve its green finance framework by further developing green bond classification standards, piloting new information sharing platforms, and improving environmental information disclosure by enterprises and financial institutions.As the world adapts and prepares for a world more vulnerable to shocks, Georgieva said shared global goals should include carbon neutrality and sustainable development. Tackling climate change requires a holistic approach that brings together environmental, social and governance issues, with appropriate policy incentives.
► 27 EU countries reached a new climate change agreement
EU countries reached an agreement on climate change proposals in the early morning of June 29, local time, supporting the gradual cessation of the sale of fossil fuel vehicles in 2035. New cars sold from 2035 must be Zero carbon emissions, which indicates that the EU will ban the sale of internal combustion engine cars. EU officials also agreed to set up a 59 billion euro EU fund to protect low-income citizens from having to pay the high costs of carbon reduction from 2027 to 2032.
► EU market regulator publishes ESG ratings market assessment
European market regulator European Markets and Securities Authority (ESMA) published its assessment of ESG rating providers on June 27, which is the next step in the EU's process of regulating the ESG ratings market. . The announcement follows a "call for evidence" launched by the regulator earlier this year to provide regulators with "a picture of the size, structure, resources, revenue and product offerings of the different ESG ratings providers operating in the EU", as well as information from ESG Ratings Feedback from users and companies covered by the ratings.
► British Infrastructure Bank invests 22 billion pounds to combat climate change
On June 23, the British Infrastructure Bank announced that it will invest 22 billion pounds to combat climate change and promote regional growth. This plan will make clean energy the largest investment area. The bank plans to invest in other key areas for the UK’s economic future, including transport, digital, water and waste, providing finance to scale up existing infrastructure and accelerate the deployment of new technologies.
Dual Carbon Report Viewpoint
International Energy Agency (IEA): "World Energy Investment Report 2022"
On June 22, the International Energy Agency (IEA) released the "World Energy Investment Report 2022". The report updates investment in 2021 and full-year forecasts for 2022 prospects, and examines how investors assess risks and opportunities in areas such as fuel and power supplies and critical minerals against the backdrop of uncertain events in 2022. Efficiency and R&D. [45] The main points of the report are:
► Against the background of global energy supply shortage, total global energy investment is expected to increase by 8% in 2022, reaching 2.4 trillion US dollars, much higher than the level before the new crown epidemic in 2019. The main growth of comes from clean energy, but it is still not enough to solve the current multi-dimensional energy and climate problems. We should continue to increase investment, improve energy efficiency, and accelerate the transformation of clean energy. Investment in fossil fuel supplies is the only area that overall remains below pre-pandemic levels in 2019. But soaring fossil fuel prices have resulted in huge profits for suppliers. Net revenues for global oil and gas producers will double to an unprecedented $4 trillion by 2022.
► Renewable energy, efficiency improvements and electric vehicles are leading the charge for clean energy. Clean energy investment is beginning to pick up and is expected to exceed $1.4 trillion by 2022, accounting for nearly three-quarters of overall energy investment growth. Renewable energy is at the heart of this positive trend, with renewables, grids and energy storage now accounting for more than 80% of total investment in the power industry. Investment in efficiency is another major area of growth, driven by rising fuel prices and government incentives. Investment in building energy efficiency increased by 16% in 2021, the largest annual increase since the report tracked investment amounts. Mobile electrification is a key factor in rising consumer spending on clean terminals. Electric vehicle sales will more than double year-on-year in 2021 and will continue to grow strongly in 2022.
► Accelerating investment in emerging and developing economies is critical to promoting the energy transition and energy security. Many emerging and developing economies rely more heavily on public resources for investment; in these economies, state-owned enterprises account for about half of energy investment.But public funds are often scarce, many state-owned utilities are heavily indebted, and a deteriorating global economic outlook has reduced governments’ ability to finance energy projects. In the absence of supportive policies, high prices do not help promote more sustainable options, especially in poorer countries. Energy shortages could force millions of people back into energy poverty. Nearly 90 million people in Asia and Africa previously had access to electricity but are now unable to pay for basic energy needs. More needs to be done to bridge the gap between emerging and developing economies’ one-fifth share of global clean energy investment and their two-thirds share of the world’s population. Additional financial and technical support, including concessional capital, private sector capital and financial inflows from international carbon markets, are critical.
► Fossil fuel investments are reacting to price signals. Currently, investment in fossil fuels is on the rise but is still nearly 30% lower than when the Paris Agreement was signed. In some regions, the shift away from Russian supplies of fossil fuels toward diversifying supply channels and resolving recent market tensions has strengthened cyclical incentives to invest in periods of high prices. However, due to high policy uncertainty and difficulty in obtaining financing, the response of investment to prices is limited. Coal supply investment is much less capital intensive than oil and gas and is less affected by larger year-over-year changes. Investment in the coal supply chain in 2021 will be approximately US$105 billion, a year-on-year increase of 10%. Due to tight energy supplies, the IEA expects investment to grow by a further 10% in 2022. This is a far cry from market conditions expected from international climate targets and Glasgow’s commitment to “phase out” coal. The refining industry saw global refining capacity fall for the first time in 2021, as a 1.8 million barrel-per-day decline outpaced relatively modest capacity additions in China and the Middle East. This has led to a rapid rise in refining margins in 2022 during a global energy supply shortage. But given that the long-term outlook for oil demand remains uncertain, strong financial performance and high utilization rates in recent months will not necessarily translate into higher investment levels.
► Critical minerals have the potential to reverse the trend of falling costs for clean energy technologies. This year’s report is the first to provide a detailed review of investment trends in key minerals for the energy transition, specifically lithium, cobalt, nickel, copper and aluminum. Prices for these critical minerals are rising more than at any time in the 2010s due to increased demand, supply chain disruptions and concerns about tightening supplies. Soaring prices are (temporarily) a major factor in reversing the downward trend in the costs of some clean energy technologies. The share of cathode material costs (including lithium, nickel, cobalt and manganese) in electric vehicle battery costs has risen from 5% in the mid-2010s to more than 20% today, with approximately 300 new gigafactories currently planned. Building and construction. Supply issues in Russia added to market tensions. Unlike fossil fuels, rising prices for key minerals are accompanied by expectations of rapid growth in demand, helping to support expanded investment plans. The IEA expects investment growth to remain strong in 2022.
► Sustainable finance faces growing pains but remains important for financing clean energy. The financial health of 's clean energy businesses has been shaky in recent years, but many publicly traded energy-related companies are starting 2022 with relatively strong balance sheets. Measures of liquidity, profitability and stock market valuations have all improved or remained stable compared with the year before the pandemic. However, this positive sign for energy investment is not universal, and many (often state-owned) energy companies in emerging and developing economies remain under severe financial pressure. The rise of sustainable finance offers significant opportunities for the energy transition, but its impact is concentrated in advanced economies. Sustainable bond issuance exceeded $1.7 trillion in 2021, with the vast majority aimed at financing renewable energy and low-carbon buildings and transportation. For emerging market and developing economies (EMDEs), although sustainable bonds have proven to be an effective way to access capital, accounting for a large portion of their total issuance, absolute values remain low compared with advanced economies. .
► Current energy investment trends show that the world is failing to meet climate goals. Although global investment in clean energy has increased significantly, current global investment is still insufficient to achieve climate change goals.Without significant increases in spending on efficiency, electrification and low-carbon supply, growing global demand for energy services may not be met in a sustainable way. Policymakers need to address many non-market barriers to urgently strengthen clean energy supply chains, such as licensing requirements and preferential arrangements for existing producers and technologies. Higher and more diverse investment in critical minerals is also an important part of the solution, as is greater support for innovation and emerging clean technologies.
British Petroleum Company (bp): "bp World Energy Statistical Yearbook 2022"
On June 28, bp released the "bp World Energy Statistical Yearbook 2022". The report pointed out that the global energy system is facing the most severe challenges and uncertainties in the past 50 years. The current energy supply shortage and soaring prices have made how to solve the "security", "economic" and "low carbon" energy trilemma increasingly important. Hair is important. [46] The main points of the report are:
► In 2021, global energy demand and carbon emissions will basically return to the levels before the COVID-19 pandemic in 2019, reversing the temporary decline in 2020 due to the COVID-19 pandemic. Global primary energy demand will grow by 5.8% in 2021, 1.3% higher than 2019 levels. Renewable energy increased by more than 8 exajoules between 2019 and 2021. Consumption of fossil fuels has remained essentially unchanged. Fossil fuels accounted for 82% of primary energy use last year, down from 83% in 2019 and 85% five years ago. The rise in carbon emissions in 2021 is driven by a rebound in economic growth. CO2 emissions from energy consumption, industrial processes, combustion and methane (measured in CO2e) rose by 5.7% in 2021 to 39 billion tonnes of CO2e. Carbon emissions generated by the energy industry increased by 5.9% year-on-year to 33.9 billion tons of carbon dioxide equivalent, close to 2019 levels. Methane, carbon dioxide emissions from industrial processes and emissions from combustion experienced relatively smaller increases year-on-year, at 4.6% and 2.9% respectively.
► Oil demand in 2021 remains below 2019 levels. Global oil production increased by 1.4 million barrels per day in 2021, with OPEC+ accounting for more than three-quarters of the increase. Oil prices averaged $70.91 per barrel, the second highest level since 2015; oil consumption increased by 5.3 million barrels per day, but was still 3.7 million barrels per day below 2019 levels. Most of the consumption growth came from gasoline (1.8 million barrels per day) and diesel/diesel (1.3 million barrels per day). Regionally, most of the growth occurred in the United States (1.5 million barrels per day), China (1.3 million barrels per day) and the European Union (570,000 barrels per day).
► Global natural gas demand will grow by 5.3% in 2021, which is higher than the pre-epidemic level in 2019, exceeding 4 trillion cubic meters for the first time. Global liquefied natural gas (LNG) supply increased by 5.6% in 2021, reaching 516 billion cubic meters. The increase was the lowest since 2015 (except for 2020). U.S. LNG supply growth of 34 billion cubic meters accounted for nearly all new growth and offset declines from other Atlantic Basin gas exporters. China has surpassed Japan to become the world's largest LNG importer, accounting for nearly 60% of global LNG demand growth in 2021. Algeria’s pipeline natural gas exports to Europe are the largest incremental source of pipeline LNG in Europe, followed by Azerbaijan. In 2021, Russia's pipeline supply to Europe was generally stable at 167 billion cubic meters, but exports to EU countries fell by 8.2%. In 2021, global natural gas prices rebounded strongly. The prices of European TTF, Asian JKM and American Henry Hub increased by approximately four times, two times and one time respectively.
► Global coal consumption will grow by more than 6% in 2021, reaching 160 exajoules, the highest level since 2014. China and India account for more than 70% of coal demand growth in 2021, with increases of 3.7 exajoules and 2.7 exajoules respectively. Coal prices have risen sharply in 2021, with European prices averaging $121/ton and Asian prices averaging $145/ton, the highest levels since 2008. In 2021, global coal production and consumption will grow simultaneously, with an increase of 440 million tons. Growth still mainly comes from China and India, with most coal production used for domestic consumption; Indonesia also accounts for a considerable part of the increase in coal production, mainly for more exports. It is worth noting that coal consumption in Europe and North America increased in 2021 after nearly 10 years of continuous decline.
► Global electricity generation increased by 6.2% in 2021, similar to the strong rebound after the 2010 financial crisis (6.4%). Wind energy and solar energy reached 10.2% of electricity generation in 2021. For the first time, wind energy and solar energy provided more than 10% of global electricity, surpassing nuclear power's share. By 2021, coal will still be the main fuel for power generation, with its share increasing from 35.1% in 2020 to 36%. In 2021, natural gas power generation increased by 2.6%, although its share fell from 23.7% in 2020 to 22.9% in 2021.
► In 2021, global non-hydropower renewable energy (including biofuels) consumption will grow by approximately 5.1 exajoules, an annual increase of 15%, which is higher than the growth rate of any other fuel in 2021. Solar and wind capacity will increase by 226GW in 2021, close to 2020’s record 236GW growth. China remains the main driver of solar and wind energy capacity growth, accounting for 36% and 40% of global solar and wind power installed capacity growth in 2021, respectively. Global hydropower production fell by about 1.4% in 2021, the first decline since 2015. In contrast, nuclear power generation increased by 4.2%, also driven mainly by China.
►Critical mineral prices increased in 2021 and maintained an upward trend in 2022. Global cobalt prices increased by 63% in 2021, averaging US$51,000/ton. Lithium carbonate prices rose 58% to an average of US$11,000/ton. In 2021, global lithium production increased significantly by 27%, while cobalt production increased by only 4%.
Rocky Mountain Institute (RMI): "The key to opening a new era of green hydrogen energy: China's 2030 "Renewable Hydrogen 100" development roadmap"
June 30, Rocky Mountain Institute (RMI) and China Hydrogen Energy Alliance research The institute jointly released "The Key to Opening a New Era of Green Hydrogen Energy: China's 2030 "Renewable Hydrogen 100" Development Roadmap." The report is based on the current development status of China's hydrogen energy industry and the "Mid- and Long-term Plan for Hydrogen Energy Industry Development (2021-2035)", which fully considers the changes in production capacity demand in various industries before 2030, the technology and cost of renewable hydrogen, and Different regional renewable resource endowments and other conditions have been studied and judged on the consumption demand of renewable hydrogen in various industries, as well as the production, installed capacity, key development industries and sources of renewable hydrogen in each region. Based on this, combined with the "Hydrogen "Medium- and Long-term Plan for Energy Industry Development (2021-2035)" puts forward relevant suggestions to promote the development of the renewable hydrogen industry. [47] The main points of the report are:
► China's various industries and regions have the potential to reach at least 100GW of renewable hydrogen installed capacity in 2030, and 00GW of renewable hydrogen installed capacity in 2030 is an important cornerstone to achieve the goal of carbon neutrality in 2060. is based on the development trend of renewable hydrogen industry technology and cost economy. For example, during the thirty-year period from 2030 to 2060, China's renewable hydrogen will expand at an annual installed capacity of about 7%, that is, the installed capacity of renewable hydrogen in 2030 will reach At least 100GW can meet the market demand for renewable hydrogen in 2060 and is basically in line with the development of the industry and market.
►Before 2030, the growth in China’s renewable hydrogen consumption demand mainly lies in the replacement of traditional fossil energy hydrogen production in the chemical industry, as well as the new demand created by new technological breakthroughs in the steel and transportation industries. According to estimates, by 2030, the total renewable hydrogen consumption in the chemical industry will reach 3.76 million tons, making it China's largest renewable hydrogen demand market; China's hydrogen metallurgical production capacity is approximately 43.47 million tons, accounting for approximately 10% of the country's total production capacity About 4.5% of the industry's hydrogen consumption is about 1.74 million tons, of which 940,000 tons are renewable hydrogen, accounting for about 54%, and the rest is industrial by-product hydrogen; the number of hydrogen fuel cell vehicles in China will reach 620,000. The total hydrogen consumption is 4.34 million tons per year, of which 3.01 million tons are renewable hydrogen and the rest is industrial by-product hydrogen.
► From a regional perspective, the production of renewable hydrogen in 2030 will be mainly concentrated in the northwest region with better renewable resource endowments and in North China and East China where industry demand for hydrogen is greater. Regions where the demand for transformation and upgrading of traditional industries matches the natural endowment of renewable resources will become important development bases for renewable hydrogen, with relatively large installed capacity and low-cost renewable hydrogen, such as the northwest region.In areas with good traditional industrial foundation, dense population and limited renewable resources, the cost of large-scale preparation of renewable hydrogen is high. The development of hydrogen energy will be supported by the "industrial by-product hydrogen + distributed hydrogen production + short-distance transportation" model, such as parts of the eastern seaboard. In areas where renewable resources have local advantages but are unevenly distributed, the "centralized hydrogen production + short- and medium-distance transportation" model can be used to achieve accelerated penetration of renewable hydrogen, such as northern North China.
► On the basis of improving the goals of sub-sectors and sub-regions, it is crucial to reduce the cost of the industrial chain by strengthening large-scale demonstrations of "big bases" and at the same time improve the renewable hydrogen industry planning of each locality that suits their own development conditions. recommends that based on the existing "Plan", we further study and formulate renewable hydrogen installation targets for 2030 and 2060, as well as sub-regional and sub-sector production and consumption targets. Strengthen linkage cooperation at all levels, carry out "big base" demonstration projects, and jointly develop the renewable "hydrogen economy". Guided by the national mid- and long-term hydrogen energy development plan, local hydrogen energy and renewable hydrogen industry support policies should be formulated according to local conditions. Increase policy support for the development of renewable hydrogen projects and improve the incentive mechanism for low-carbon clean hydrogen projects.
► China’s overall hydrogen energy development strategic layout needs to be staged and step-by-step, taking advantage of the complementarity of hydrogen energy from different sources, maximizing the emission reduction effect of hydrogen energy, and creating a more adequate development foundation for renewable hydrogen. should consider diversified applications in the near future, taking into account both economy and cleanliness, using fossil energy to produce hydrogen and by-product hydrogen to effectively drive the large-scale development of the hydrogen energy consumption side, cultivate the upstream and downstream hydrogen energy industry chains, and reduce the whole life cycle cost while At the same time, it will pave the way for the promotion and application of green hydrogen. In the mid-term, a supply system dominated by renewable hydrogen will be gradually built, and the transition to renewable hydrogen will be gradually realized through strengthened market-oriented means and policy measures to guide and incentivize production and application scenarios. In the long term, comprehensive breakthroughs will be made to realize the synergy of renewable hydrogen and electricity and complete the replacement of fossil energy in heavy industry and long-distance transportation.
Carbon neutrality cutting-edge science and technology
► Binghamton University: Three-layer bacterial biobattery can sustainably generate electricity for weeks
On June 22, according to Tech Xplore, a scientific research team at Binghamton University in the United States developed a biological The battery, which contains three layers of different bacterial species, absorbs sunlight and generates electricity. While the team's previous battery developed two types of bacteria interacting to produce the required power, this new iteration stacks chambers containing different bacteria in three layers. The top layer is made up of photosynthetic bacteria, which gain energy from sunlight and produce organic molecules that provide food for the bacteria below. At the bottom are electrogenic bacteria, and the bacteria in the middle produce some chemicals to improve electron transport. [48]
► Chinese Academy of Sciences: Closed-loop cobalt recovery from waste lithium-ion batteries based on deep eutectic solvent (DES)
html On June 24, according to Tech Xplore, a team from the Chinese Academy of Sciences reported a deep eutectic solvent based on ChCl:OA (DES) closed-loop efficient method to recover lithium cobalt oxide from spent lithium-ion batteries. The ultra-fast leaching process can be achieved in 10 seconds at 180°C, and nearly 100% leaching rate can be achieved in 2 hours at 90°C, meeting the design requirements for a mild and efficient reaction process. This method can reversibly adjust the solubility of cobalt ions by simply adding/evaporating deionized water, thereby avoiding the addition of precipitating agents, making the leaching solvent easy to recover, and achieving a closed-loop recovery process. [49]►Chinese Academy of Sciences: Anode-free sodium battery with high energy density and long cycle life
On June 29, according to Tech Xplore reports, a research team from the Chinese Academy of Sciences and other institutions developed an initial anode-free sodium battery with an energy Density and cycle life are higher than ordinary sodium-ion batteries. This anodeless sodium battery is manufactured by introducing a graphitic carbon coating on an aluminum current collector and a boron-containing electrolyte in the battery, and using an interface engineering approach. Each cell includes a boron-based electrolyte, graphite current collector, and layered oxide. cathode. Test results found that the sodium battery has a cycle life of 260 cycles without applying additional pressure and an energy density of over 200Wh/kg, even higher than commercial lithium iron phosphate graphite batteries.[50]
► Daegu Gyeongbuk Institute of Science and Technology: Improving the efficiency of solar cells’ light absorption capacity
html On July 1, according to Tech Xplore, a research team at Daegu Gyeongbuk Institute of Science and Technology proposed a new method to improve the efficiency of solar cells’ light absorption capacity. The team enhanced the solar cells' light absorption capabilities and photocurrent generation by implementing nanostructured electrodes on the backside of perovskite quantum dot solar cells, a next-generation solar cell material. In addition, the team systematically verified the correlation between nanostructure shapes and solar cell efficiency, as well as optimized conditions for nanopattern formation in organic materials. [51]► Hong Kong University of Science and Technology: Building the world’s most durable hydrogen fuel cell
html On July 1, according to Tech Durable and more cost effective. The new formula developed by the team reduced the proportion of platinum used in hydrogen fuel cells by 80% and also set a record in terms of battery durability. The new hybrid catalyst can manage to maintain platinum catalytic activity at 97% after 100,000 accelerated stress tests, while current catalysts typically lose more than 50% in performance after 30,000 cycles. In another test, the new fuel cells did not show any performance degradation after 200 hours of operation. The reason behind the improved performance is that the new catalyst has three different active sites for the reaction, whereas current catalysts only have a single active site. Using a formulation containing atomically dispersed platinum, iron single atoms and platinum-iron nanoparticles, the new mixture accelerated the reaction rate and achieved catalytic activity 3.7 times higher than platinum itself. Theoretically, the higher the catalytic activity, the more power it can provide. [52]► University of California, San Diego: Liquefied gas electrolyte helps manufacture temperature-resistant lithium batteries
html On July 5, according to Tech Xplore reports, a research team at the University of California, San Diego developed a new liquefied gas electrolyte (LGE) that can be used in production Lithium metal battery, allowing it to operate safely between -60°C and 55°C. The team designed an electrolyte composed of various fluorocarbon gases that, when pressure is applied, liquefy to form an electrolyte with stable chemistry, a low freezing point, and low cost. This LGE is highly compatible with lithium metal batteries, and in initial tests using lithium anodes, it achieved an average Coulombic efficiency (CE) of 99.6% over 500 cycles.Summary
Domestic and foreign carbon neutrality policy dynamics (June 23 to July 6): 1) Domestically, the Ministry of Transport and other departments issued opinions on the implementation of "double carbon" work in the field of transportation, proposing to optimize transportation. transportation structure, promote energy-saving and low-carbon transportation, actively guide low-carbon travel, and enhance new momentum for green transformation; The Ministry of Agriculture and Rural Affairs and the National Development and Reform Commission jointly released the "Agricultural and Rural Emission Reduction and Carbon Sequestration Implementation Plan" , proposing energy conservation in the planting industry Six tasks including emission reduction, and ten major actions including reducing methane emissions in rice fields were implemented; the Ministry of Finance and other departments revised and promulgated the "China Clean Development Mechanism Fund Management Measures" to appropriately expand the scope of fund use to support "dual carbon"; The " Industrial Energy Efficiency Improvement Action Plan " released by the Ministry of Industry and Information Technology and others proposes that by 2025, the energy consumption of the added value of industrial units above designated size will drop by 13.5% compared with 2020, and so on. ) Internationally, The U.S. Supreme Court weakened the Environmental Protection Agency’s regulation of power plant emissions, while the Department of Energy revised the standards for the civilian nuclear credit program; the United Kingdom invested 20.9 billion pounds to increase power grid capacity; Germany passed a bill allowing the government to assist energy companies, Plans to levy a natural gas tax; The Netherlands provides 164 million euros in subsidies for natural gas storage, and announces a 750 million euro national hydrogen network plan; Greece plans to cancel the electricity surcharge; Australia strengthens its clean energy agreement with India, and the Australian spot power market restarts .
Hot “Carbon” Research: On June 22, the European Parliament voted to adopt amendments to the Carbon Border Adjustment Mechanism (CBAM) draft, but the free quota exit time, tax scope and carbon cost “tax rebate” are still to be determined later. We judge that the embodied carbon emissions under the new plan will increase, the carbon emission intensity standards will be more stringent, the start time will be postponed, but the transition period for the withdrawal of free quotas will be shortened. Chinese companies may be affected by the following: 1) The affected China-EU trade volume has increased significantly (especially for mid-stream and downstream companies); 2) Some companies cannot pass EU CBAM certification; 3) The transformation window period of Chinese companies may be shortened; 4) There is uncertainty about the impact on backward enterprises. It is suggested that domestic high-energy-consuming enterprises can respond by adapting to EU rules, establishing mutual recognition channels for carbon emissions, reducing carbon emission intensity, and diversifying export layouts. Investors in related fields can pay attention to changes in the industry competition landscape, the increase in the investment value of clean energy operators, and opportunities in carbon monitoring and assessment subdivisions.
Carbon neutral related industry and corporate news: 1) Carbon neutral transformation industry: Han is investigating in Shanxi and hosting a symposium on clean and efficient utilization of coal; Guangzhou City is stepping up its efforts to promote the implementation of energy projects and strive to add a batch of clean coal The six departments of the Ministry of Industry and Information Technology proposed that the energy efficiency of products in steel and other industries should reach international levels by 2025. The Ministry of Industry and Information Technology said that currently lithium resources are still operating at a high level and will do a good job in ensuring power battery resource materials from three aspects. ) Carbon-neutral growth industry: The dual-carbon index continues to pick up, and the growth in industry scale and demand expansion are gradually realized. In the past two weeks, the CICC low-carbon industry index has increased by 8.6%. Carbon neutrality-related industries continued to rebound after consecutive corrections, with energy storage, power batteries and new energy vehicle sectors leading the gains. Specifically, prices in the photovoltaic industry chain increased, with the photovoltaic managers' industry-wide index rising by 2.3% from two weeks ago, and the upstream and midstream manufacturing and downstream power stations rising by 2.6% and 1.0% respectively. New energy vehicles continued to recover strongly in June, with the delivery volume of many car companies hitting record highs and the industry index rising by 7.5%. ) Enterprise "dual carbon" action: COSCO Shipping, PetroChina and China State Shipbuilding, the three major central enterprises signed a contract to create a new model for the development of China's LNG industrial chain; CNOOC released a dual-carbon action plan; the National Energy Group Jiangsu Company's coal-fired power station is very large Large-scale carbon capture technology was launched; Sinochem International released the "2021 Sustainability Report", its 18th sustainable development report; Sinopec geothermal science exhibition opened to promote green and low-carbon concepts.
Sustainable Finance and ESG: 1) Green Bonds : There are 1,516 labeled green bonds in China, with a stock size of 167 million yuan, including 130 carbon-neutral bonds, with a stock of 163.6 billion yuan, accounting for 15% of the total balance of green bonds. 9.8%. A total of 49 new green bonds were issued in June, with an issuance scale of RMB 61.2 billion, which was about 15% lower than the issuance scale of RMB 72.1 billion in May. Among them, 6 carbon neutral bonds were newly issued, with an issuance scale of RMB 11.4 billion. Since the beginning of July, 13 green bonds have been issued, with a scale of RMB 5.1 billion. ) Carbon market: The trading activity of the national carbon market was the same as in the previous period, and the carbon price continued to fluctuate in a narrow range around 59 yuan per ton in 2Q22; Beijing’s carbon price showed an upward trend; the EU carbon market reform pushed the carbon price to a high of 85 euros per ton fluctuation. ) ESG: The State Council issued the "Guiding Opinions on Strengthening the Construction of Digital Government" to promote the realization of dual carbon goals; the "General Principles for Corporate ESG Information Disclosure" and "General Principles for Corporate ESG Evaluation" were released; multiple departments of the Ministry of Finance revised the "China Clean Development Mechanism" Fund Management Measures", broaden the scope of fund use, and add "support for dual-carbon, green and low-carbon activities" and other content.
report views: 1) IEA predicts in "World Energy Investment Report 2022" that total global energy investment will increase by 8% in 2022, reaching 2.4 trillion US dollars. Clean energy investment is expected to exceed US$1.4 trillion, accounting for about 3/4 of the overall energy investment growth, of which investment in renewable energy, efficiency improvements and electric vehicles are the three major driving factors. ) bp released "bp World Energy Statistical Yearbook 2022" pointed out that the global energy system is facing the most severe challenges and uncertainties in the past 50 years. Global energy demand and carbon emissions are still in an upward cycle, with increases of 5.8% and 5.7% respectively in 2021, basically returning to pre-pandemic levels in 2019. ) RMI pointed out in "The Key to Opening a New Era of Green Hydrogen Energy: China's 2030 "Renewable Hydrogen 100" Development Roadmap" that various industries and regions in China have the potential to reach at least 100GW of renewable hydrogen installed capacity in 2030. And the growth in consumer demand mainly comes from the chemical industry, steel and transportation industries.
Cutting-edge science and technology: Binghamton University develops a three-layer bacterial biobattery that can last for weeks; Chinese Academy of Sciences realizes closed-loop cobalt recycling of waste lithium-ion batteries based on deep eutectic solvent; Chinese Academy of Sciences launches high-energy long-term Cycling anodeless sodium battery; Daegu Gyeongbuk Institute of Science and Technology uses nanostructured electrodes to improve the light absorption efficiency of solar cells; Hong Kong University of Science and Technology develops the most durable new hydrogen fuel cell; University of California, San Diego develops new liquefied gas electrolytes Helps manufacture temperature-resistant lithium batteries.
Table of Contents
Carbon Neutral Hotspot Policies/Events
Hotspot "Carbon" Research: The EU Carbon Border Regulation Mechanism is Coming - What do you think? what to do?
Carbon neutrality related industry and corporate news
Sustainable finance and ESG
Dual carbon report perspective
Carbon neutrality cutting-edge science and technology
Weather and climate
Text
Carbon neutrality hot policies/events
chart: hot topics at home and abroad in the past two weeks Policy/Event Tracking (June 23-July 6, 2022)
Source: Government websites such as the State Council, National Development and Reform Commission, Reuters, etc., CICC Research Institute
Domestic Policy and Event Tracking
► Ministry of Transport, etc. 4 Department: Opinions on the implementation of "dual carbon" work in the transportation field were released
html On June 28, four departments including the Ministry of Transport jointly issued to implement the "Central Committee of the Communist Party of China and the State Council's Notice on Completely, Accurately and Comprehensively Implementing the New Development Concept to Do a Good Job in Carbon Peaking and Carbon Neutrality" The implementation opinions of "Opinions" put forward the working principles of overall promotion, energy conservation, reform and innovation, and scientific and orderly work, emphasizing optimizing the transportation structure, promoting energy-saving and low-carbon transportation, actively guiding low-carbon travel, and enhancing the green transportation New driving forces for transformation and strengthening organizational implementation and other key contents.[1]► Ministry of Agriculture and Rural Affairs, National Development and Reform Commission: "Implementation Plan for Agricultural and Rural Emission Reduction and Carbon Sequestration"
html On June 30, the Ministry of Agriculture and Rural Affairs and National Development and Reform Commission jointly released "Implementation Plan for Agricultural and Rural Emission Reduction and Carbon Sequestration" . The "Plan" proposes that by 2025, a pattern that integrates agricultural and rural emission reduction and carbon sequestration with food security, rural revitalization, and agricultural and rural modernization will be basically formed; by 2030, the comprehensive green transformation of agriculture and rural areas will achieve remarkable results. The "Plan" focuses on six tasks including energy conservation and emission reduction in the planting industry, emission reduction and carbon reduction in the livestock industry, fishery emission reduction and increase sinks, carbon sequestration expansion in farmland, energy conservation and emission reduction in agricultural machinery, and renewable energy substitution. It implements methane emission reduction in rice fields, chemical fertilizer reduction, etc. Ten major actions include increasing quantity and efficiency, supporting scientific and technological innovation, and building a monitoring system. [2]► The Ministry of Finance and other 7 departments: The "China Clean Development Mechanism Fund Management Measures" was revised and promulgated
html On June 28, the Ministry of Finance and other 7 departments revised and announced the "China Clean Development Mechanism Fund Management Measures", starting from August 2022 Effective from the 1st. The "Measures" moderately broadened the scope of use of the fund. On the basis of retaining the stipulation that the purpose of the fund is "supporting the country's response to climate change", it added "supporting carbon peak carbon neutrality, pollution prevention and ecological protection and other green and low-carbon activities" fields and promote high-quality economic and social development. At the same time, the "Measures" clarify that the fund will be used in a paid manner to support project activities that are conducive to achieving carbon peak carbon neutrality, generating benefits in addressing climate change, and implementing major national decisions and arrangements related to pollution prevention and ecological protection. The "Measures" have made three improvements to the fund's operating model and organizational structure: First, the fund's operating model has been modified from the current "according to the social fund model" to "operated according to the market-oriented model", and stipulated that the paid use of the fund relies on professional institutions carry out. The second is to modify the fund's organizational framework from the current "Fund Review Council and Fund Management Center" to "Fund Policy Steering Committee and Fund Management Center". The Fund Review Council is responsible for reviewing major business matters of the fund and is now responsible for the Fund Policy Steering Committee. Provide guidance on major matters related to fund development. The third is to stipulate that representatives from the Ministry of Finance, the Ministry of Ecology and Environment, and the National Development and Reform Commission serve as co-chairs of the Fund Policy Steering Committee and are responsible for convening and chairing meetings of the Fund Policy Steering Committee. [3]► Six departments including the Ministry of Industry and Information Technology: "Action Plan for Improving Industrial Energy Efficiency" to promote green and low-carbon development in key industries
On June 29, six departments including the Ministry of Industry and Information Technology released the "Action Plan for Improving Industrial Energy Efficiency". The "Plan" is divided into four parts, including guiding ideology, main goals, main tasks and safeguard measures. Its main goal is that by 2025, the energy efficiency of key industrial industries will be comprehensively improved, the energy efficiency of key areas such as data centers will be significantly improved, the proportion of green and low-carbon energy utilization will be significantly increased, energy-saving and efficiency-improving technology and equipment will be widely used, and standards, services and supervision systems will be gradually improved. , the value-added energy consumption of industrial units above designated size dropped by 13.5% compared with 2020. Making the best use of energy and putting efficiency first has become a common concept and common requirement among market entities and the public. Energy conservation and efficiency improvement have further become the green and low-carbon "first energy source" and the primary measure for reducing consumption and carbon emissions. At the same time, a series of specific goals are proposed based on the actual development of the industry. By 2025, the proportion of new high-efficiency and energy-saving motors will reach more than 70%, the proportion of new high-efficiency and energy-saving transformers will reach more than 80%, and the power utilization efficiency of newly built large and ultra-large data centers will be (PUE) is better than 1.3, and the proportion of electric energy in the industrial sector to terminal energy consumption reaches 30%. The "Plan" proposes to vigorously improve energy efficiency in key industries, continue to improve the energy efficiency of energy-using equipment systems, coordinate and improve the comprehensive energy efficiency of enterprise parks, orderly promote the low-carbon transformation of industrial energy use, actively promote the upgrading of digital energy efficiency, and continue to consolidate energy-saving and efficiency-improving industries. 7 key tasks including laying the foundation and accelerating the improvement of energy-saving and efficiency-improving systems and mechanisms.[4]
► Four departments including the Ministry of Ecology and Environment: " Yellow River Basin Ecological Environment Protection Plan" proposes synergistic effects of pollution reduction and carbon reduction
On June 28, four departments including the Ministry of Ecology and Environment released "Yellow River Basin Ecological Environment Protection Plan" 》, puts forward 7 key tasks. The first is to optimize the spatial layout and accelerate the green development of the industry; the second is to promote the overall planning of the three waters and manage and restore the water ecological environment; the third is to strengthen regional cooperation and achieve synergy in reducing pollution and carbon dioxide; the fourth is to Strengthen management, control and restoration to prevent soil and groundwater pollution; fifth, adhere to ecological priority and implement systematic protection and restoration; sixth, strengthen source control to effectively prevent major environmental risks; seventh, build a governance system and improve governance levels. In order to ensure the completion of the target tasks, the "Plan" also deployed eight types of key projects, namely water environment protection and treatment projects, air pollution control projects in key industries, clean heating renovation projects, mobile source pollution control projects, and soil and groundwater pollution control projects. , ecological protection and restoration projects, hazardous waste collection and disposal capacity improvement projects, and medical waste collection and disposal capacity improvement projects, etc. [5]
► Ministry of Finance and National Development and Reform Commission: "Notice on Implementing Phased Price Subsidies after International Oil Prices Hit the Regulatory Upper Limit"
On June 29, the Ministry of Finance and National Development and Reform Commission issued "On Doing a Good Job in Implementing Periodic Price Subsidies" Notice on the implementation of phased price subsidies after the international oil price reaches the upper limit of regulation》. The notice pointed out that when the price of crude oil in the international market is higher than the upper limit of refined oil price regulation stipulated by the state, the price of refined oil will no longer be raised in stages, and the central government will provide corresponding price subsidies to oil refining companies. The subsidy targets are refined oil production and operation enterprises that produce, process and import gasoline and diesel within the territory of the People's Republic of China, hereafter referred to as oil refining enterprises. When the price of crude oil in the international market is higher than the upper limit of refined oil price regulation stipulated by the state (US$130 per barrel), phased price subsidies will be implemented for oil refining companies. The duration of the policy will be temporarily controlled for two months. If the price of crude oil in the international market continues to rise, In view of the upper limit of price control of refined oil products stipulated by the state, relevant control policies will be clarified in advance. [6]
► National Development and Reform Commission and other four departments: "Special Rectification Action Plan for Enterprise-related Illegal Charges" to rectify power supply price violations
On June 28, the National Development and Reform Commission and other four departments released "Special Rectification Action Plan for Enterprise-related Illegal Charges" , proposing special rectification of illegal charging issues involving enterprises in the field of water, electricity and heating. Strengthen price supervision in the fields of water supply, electricity, gas and heating, inside and outside the red line, construction and installation, renovation, maintenance and repairs, focusing on rectification of non-implementation of government pricing and government-guided prices, use of monopoly status to pass on costs that should be borne by oneself, and self-determined standards Charging fees for self-installed projects, charging illegal fees for measuring devices and compulsory inspections, etc. Focus on rectifying issues such as unreasonable price increases and illegal price increases in non-grid direct power supply links. Investigate and punish repeated apportionment of charges to users in the name of electricity service fees, failure to implement the electricity price disclosure system, and failure to completely clear out unreasonable charges that have been collected. It is strictly forbidden to increase power supply prices beyond the maximum allowable increase stipulated in the policy. [7]
► Han Zheng: The symposium on the clean and efficient utilization of coal emphasized the need to ensure the quantity and price of coal.
html On June 28, Vice Premier Han Zheng chaired the symposium on the clean and efficient utilization of coal and made a speech, proposing that we should do a good job in ensuring the quantity and price of coal. The quantity and price of coal shall be guaranteed, the clean and efficient utilization of coal shall be vigorously promoted, and high-quality development that prioritizes ecology, green and low carbon shall be solidly promoted. Han Zheng pointed out that promoting the clean and efficient use of coal is an important way to promote the green and low-carbon transformation of energy and achieve the goal of carbon peak and carbon neutrality. It is necessary to keep the bottom line of energy security based on the basic national conditions of coal-dominated energy, give full play to the "ballast stone" role of coal, and contribute to stabilizing the macroeconomic environment, stabilizing prices and protecting people's livelihood. We must adhere to the combination of long-term and near-term, establish first and then break, respect the laws of the market, strengthen government regulation, establish a long-term mechanism conducive to sustainable development, and coordinate the clean and efficient utilization of coal.It is necessary to promote the coordinated development of coal power and renewable energy, fully mobilize the enthusiasm of local governments and enterprises, and promote coal power joint ventures and coal power and renewable energy joint ventures. It is necessary to strengthen supervision, management, inspection and accountability to ensure the performance of medium and long-term thermal coal contracts. We will do a solid job in ensuring energy supply during the summer peak, and effectively ensure the electricity consumption for people's livelihood and the normal production of enterprises. We must firmly adhere to the bottom line of production safety and resolutely curb the occurrence of major accidents. [8]►Beijing Municipal Ecological Environment Bureau: "Beijing's Low Carbon Pilot Work Plan during the 14th Five-Year Plan"
On June 29, the Beijing Municipal Ecological Environment Bureau released "Beijing's Low-Carbon Pilot Work Plan during the 14th Five-Year Plan" Carbon Pilot Work Plan》. The "Work Plan" proposes that by 2025, a number of advanced low-carbon technologies will be screened, a number of low-carbon front-runner enterprises and public institutions will be cultivated, a number of climate-friendly regions will be built, and a number of comprehensive climate investment and financing policy tools will be condensed and summarized. , to accumulate experience and provide support for the research and formulation of climate change mitigation and adaptation policies, regulations, and standards, and to provide a reference and replicable model for the whole society to practice low-carbon production and lifestyle. According to different pilot subjects and work content requirements, four types of pilot work will be carried out: advanced low-carbon technology pilots, low-carbon front-runner pilots, climate-friendly regional pilots, and climate investment and financing pilots. [9]
► Shanghai Municipal Development and Reform Commission and other four departments: "Implementation Plan on Strict Energy Efficiency Constraints to Promote Energy Conservation and Carbon Reduction in Key Areas of the City"
html On June 28, Shanghai Municipal Development and Reform Commission and other four departments issued "About Strict Energy Efficiency Constraints to Promote Energy Conservation and Carbon Reduction" Implementation plan for energy conservation and carbon reduction in key areas of our city》. The "Implementation Plan" proposes that by 2025, through the implementation of carbon peak actions in the industrial sector and energy conservation and carbon reduction actions in key industries, the energy consumption of Shanghai's industrial added value above designated size will decrease by 14% compared with 2020. Steel, cement, oil refining, ethylene The proportion of production capacity in key industries such as , , synthetic ammonia and has reached the benchmark level of more than 30%, and the proportion of data centers that has reached the benchmark level is about 60%. The overall energy efficiency level of the industry has been significantly improved, the carbon emission intensity has been significantly reduced, and the green and low-carbon development capabilities have been significantly enhanced. By 2030, the energy resource utilization efficiency, overall energy efficiency level and carbon emission intensity of Shanghai's key industries will reach the international advanced level, the proportion of production capacity that reaches the benchmark level will further increase, energy-saving and low-carbon technologies will make breakthrough progress, and green and low-carbon transformation and development will make significant progress. Effectiveness. [10]► Sichuan Provincial Department of Economics and Information Technology: "Sichuan Province's "14th Five-Year Plan" Industrial Green Development Plan"
html On June 29, Sichuan Provincial Department of Economy and Information Technology released "Sichuan Province's "14th Five-Year Plan" Industrial Green Development Plan Development Plan》. The "Plan" proposes that by 2025, significant results will be achieved in the green transformation of industrial production methods and industrial structures, green and low-carbon technology and equipment will be widely used, the level of energy resource utilization will be steadily improved, and the intensity of carbon emissions and pollutant emissions will be further reduced. In order to achieve the goals of 2030 Carbon peaked two years ago, laying a solid foundation. The energy utilization efficiency of and has been steadily improved, and the energy consumption of the added value of industrial units above designated size has dropped by 14%. Carbon emission intensity continues to decline, with carbon dioxide emissions per unit of industrial added value falling by 19.5%. The efficiency of resource utilization has been greatly improved. The water consumption of with an industrial added value of 50,000 yuan has dropped by 16% compared with 2020, and the comprehensive utilization rate of bulk industrial solid waste has reached 57%. The construction of the green manufacturing system is advanced in depth, striving to create 200 new green factories and 20 green parks, and cultivate 30 green and low-carbon parks and 60 green and low-carbon factories. [11]International Policy and Event Tracking
►The U.S. Supreme Court weakens the Environmental Protection Agency’s regulation of power plant emissions
On June 30, according to CNBC, the latest U.S. Supreme Court ruling restricted the Environmental Protection Agency from regulating climate change greenhouses for existing power plants. Gas emission standards power. Under a Supreme Court vote, only Congress has the power to create a broad system of cap-and-trade regulations to limit emissions from existing power plants. [12]
► The U.S. Department of Energy revise standards for the Civilian Nuclear Credit Program
On June 30, according to Reuters reported, the U.S. Department of Energy (DOE) announced that it would extend the deadline for applications and bids for the Civilian Nuclear Credit Program by two months.At the same time, the eligibility criteria for the civil nuclear credit program were revised, that is, nuclear reactors "cannot recover more than 50% of the costs from the cost of service regulations or regulated contracts", which may affect the reactor being awarded funding in the first round. qualifications. [13]
► EU carbon tariff passed the European Parliament vote
On June 22, according to the official website of the European Parliament, the European Parliament passed the establishment of the Carbon Border Adjustment Mechanism (CBAM) with 450 votes in favor, 115 votes against and 55 abstentions. Amendments to the draft. The proposal was originally scheduled for voting on June 8, but was canceled due to various reasons. The proposal passed this time is a revised version of the June 8 version. Compared with the more radical version to be voted on on June 8, the amendments passed this time have slightly milder provisions, mainly extending the transition period and the free quota exit time by two years. [14]
► British Power Grid launches 20.9 billion pound funding plan to increase grid capacity
On June 29, according to Reuters, the British energy regulator Ofgem approved a 20.9 billion pound spending plan that will be used to increase regional power grid capacity. , improve the power distribution network. The budget includes £2.7 billion in upfront funding, mainly for building new networks. In addition, Ofgem recommended reducing the company's equity cost provision to 4.75%. [15]
►The German cabinet passed a bill to allow the government to assist energy companies
html On July 5, according to Reuters, the German cabinet passed a bill to allow the government to assist struggling energy companies. The bill allows the German government to provide rescue packages including shareholdings and also introduces a mechanism to pass on part of the rising cost of natural gas to consumers. In addition, general price adjustment provisions may also be triggered if natural gas imports are significantly disrupted. The law will be voted on by the lower and upper houses of parliament on July 8. [16]► Germany plans to impose a natural gas tax on all consumers
html On July 1, according to Reuters, the German government plans to pass parliamentary legislation to impose a tax on all natural gas consumers to help suppliers cope with rapidly rising import prices. The German Bundestag is expected to decide on July 8 whether the tax bill will be passed. [17]► The Dutch government provides a subsidy of 169 million euros to replenish natural gas storage
On July 5, according to Reuters, the Dutch government provided a subsidy of 164 million euros to replenish the Bergermeer natural gas storage facility in the Netherlands. The subsidy program aims to fill 4.1 billion cubic meters of facilities 68% by October this year. [18]
►The Netherlands announced a 750 million euro national hydrogen network plan
html On June 29, according to Reuters, the Dutch government stated that it would invest 750 million euros to establish a national hydrogen transportation network by 2031. Dutch gas network operator Gasunie will manage and operate the network, part of which is due to be completed in 2026. [19]► Greece plans to cancel the electricity surcharge
html On June 25, according to Reuters, Greece plans to cancel the electricity surcharge levied by power companies as part of the government's efforts to mitigate the impact of rising energy costs on consumers. The policy is expected to last from August 2022 to July 2023. [20]► Australia’s spot power market is lifted from suspension
html On June 22, according to Reuters, the Australian Energy Market Monitor (AEMO) will lift the suspension of the spot power market in phases. Electricity production has returned to more normal conditions as some coal-fired generators restarted. The market suspension will be lifted in stages, and the market will be allowed to set prices again from 4 a.m. local time on June 23. AEMO will decide to officially cancel the market suspension after monitoring market conditions for at least 24 hours. [21]Hot "Carbon" Research: The EU Carbon Border Regulation Mechanism is Coming - What do you think? what to do? Is
CBAM really coming?
The latest progress in the EU’s promotion of CBAM
On June 22, 2022, the European Parliament voted to adopt an amendment to the draft establishing a Carbon Border Adjustment Mechanism (CBAM) [22].This means that this high-profile proposal is only the "last mile" away from final legislation. We expect that the European Commission, the European Parliament and the European Council will hold tripartite talks on this proposal in the second half of the year and finally pass it.
Chart: EU CBAM legislation timeline
Source: European Parliament official website, CICC Research Institute
The CBAM process has had twists and turns, highlighting the EU's determination to be net-zero. Since the European Commission proposed the legislative draft in July last year, the advancement process of CBAM has been described as "twisting and turbulent". Especially affected by factors such as global energy supply shortages and the Russia-Ukraine conflict, the content of the draft has also been controversial within the EU. In July last year, During the feedback period in November, a total of 194 feedbacks were received from various stakeholders within the EU [23]; on June 8 this year, the day when the European Parliament planned to vote and review, CBAM’s vote was recommended because the ETS bill was not passed. Cancellation, finally passed on June 22. Although the steps are difficult, whether it is the rapid revision of the bill and its passage, the EU carbon market's 2030 emission reduction target passed from 61% to 63%[24], or the subsequent June 28, led by Germany, The statement on the Climate Club issued at the G7 summit and the commitment to further accelerate the solution to the problem of carbon leakage from emission-intensive products[25] all demonstrate the EU's unshakable climate ambition. We have discussed the carbon border adjustment mechanism in "Carbon Policy China (12): The United States plans to require listed companies to disclose carbon emission-related information". This time, we will further analyze the latest progress of the mechanism and try to propose potential response suggestions.
What are the current uncertainties and their influencing factors?
According to the analysis of the EU legislative process and the passing rate of relevant bills from 2014 to 2019, the first reading pass rate of the CBAM bill is as high as nearly 90%[26]; according to the European Parliament’s announcement this year China and the EU will launch the "tripartite consultation" [27] between EU institutions to negotiate on the controversial points in the current CBAM plan and further eliminate obstacles in the formal legislative process in the future. Of course, considering the current reality of unprecedented inflationary pressure in Europe, the EU Council still has the possibility of making further adjustments to the exit schedule of free quotas for EU industries in CBAM, carbon cost refunds (tax rebates) for EU product exports, and the scope of CBAM taxation. . At present, we believe that there are three specific uncertainties:
) Whether the withdrawal time of free emission quotas for EU industries will be postponed.
) Whether the scope of CBAM taxable products will be expanded. Compared with the plan proposed by the European Commission in July 2021 (hereinafter referred to as the "European Commission Plan"), the scope of taxable products in the European Parliament plan includes chemicals and plastics. In addition, in the European Commission's plan, whether to expand the scope of taxed products in the future requires collecting relevant information before 2025 for judgment, while the European Parliament's plan not only requires the gradual inclusion of products currently controlled by ETS (mainly upstream high-energy-consuming industries) , also requires the inclusion of downstream products under the jurisdiction of CBAM, which greatly increases the coverage of CBAM taxable products, which will become another focus of the "tripartite consultation".
) Should EU export products enjoy carbon cost “tax rebates”? The European Parliament and the European Council agreed that the European Commission should assess the impact on export carbon leakage during the implementation of CBAM and focus on whether additional measures are needed to refund part of the carbon cost of EU export products, which reflects the internal EU industry. The industry is concerned that higher carbon costs will affect the export competitiveness of its products. However, this item was not included in last year's European Commission plan, and there is still some uncertainty as to whether this "tripartite consultation" can reach an agreement on this matter.
What do you think of the EU carbon border adjustment mechanism?
CBAM taxation implementation process
From the general process, a product exported to the EU to pay the carbon border adjustment tax needs to go through five links: registration, pre-purchase, declaration, settlement and liquidation. Among them, import companies within the EU bear the main payment task:
Chart: EU CBAM taxation implementation process
Source: European Parliament official website [28], CICC Research Institute
) Registration link: EU companies that import CBAM controlled products from outside the EU first need to register in the EU CBAM system to obtain qualifications .
) Pre-order link: CBAM voucher is paid once a year, and the price is updated once a week based on the actual operation of ETS. In order to prevent importers from concentrating on buying CBAM certificates at a certain time of the year, the EU requires importers to pre-purchase at least once a quarter, and each pre-purchased CBAM certificate covers at least 80% of the estimated emissions.
) Declaration link: has two ways to declare product carbon emission intensity. The importer reports the actual emissions of imported products to the CBAM management agency before settlement; or the exporter registers in the CBAM system on its own and submits the actual emissions of the products verified by a third-party agency.
) Settlement link: importers must pay the CBAM certificate for the previous year based on the actual emissions before the end of May each year. If there is no relevant data, the default emissions will be used.
) Liquidation link: The EU prohibits private trading of CBAM certificates. For the part where the total amount of pre-purchased certificates by the importer exceeds the actual required amount (that is, the remaining certificates), the EU will buy back the importer at the original price, but the total amount will not exceed The importer purchased one-third of the total number of vouchers in the previous year, and the remaining vouchers in the previous year will be cleared directly.
Carbon border adjustment tax accounting method
Carbon border adjustment tax essentially makes imported goods bear the same carbon cost as similar EU goods based on their carbon content. It mainly involves carbon emission accounting boundaries, carbon emission intensity standards and carbon tax price standards, etc. In terms of carbon emissions accounting, the basic calculation process is as follows:
Chart: EU carbon border adjustment tax calculation process
Source: European Parliament official website, CICC Research Institute
From the perspective of carbon emission accounting boundary, the carbon emissions implied by the European Parliament plan will increase. According to the European Parliament plan, the carbon emissions of imported products are mainly calculated from two parts, namely direct emissions and indirect emissions. Direct emissions refer to the emissions produced in the production process directly controlled by the producer of a product, including emissions from the cooling and heating processes; indirect emissions refer to the emissions from the electricity used in the production process of a product. Compared with previous versions, this European Parliament plan also incorporates emissions from electricity used in product production into the accounting system, which will result in the calculated embodied carbon emissions of products being higher than in previous versions.
From the perspective of product carbon emission intensity standards, the European Parliament’s plan is more stringent. The EU encourages importers to declare based on actual emission intensity. However, if the importer fails to declare, or cannot fully determine the reliability of the actual declared emission intensity, the default emission intensity will be used. In the European Parliament's plan, the default carbon intensity is the average carbon intensity of the bottom 10% of the carbon emission levels of similar product manufacturers in the exporting country. If the country does not have the above data, the average carbon intensity of the last 5% of the carbon emission levels of similar product manufacturers in the EU will be used. In comparison, the standards of the previous European Commission plan are more relaxed. The default carbon emission intensity will be the average emission intensity of similar product manufacturers in the exporting country. If the country does not have the above data, the reciprocal carbon emission level of similar product manufacturers in the EU will be used. 10% average carbon intensity.
From the perspective of carbon tax price collection standards, although the European Parliament’s plan postpones the start time of CBAM and compromises the withdrawal time of free carbon quotas compared to the European Parliament’s proposed voting plan on June 8, there is still a transition period for the gradual withdrawal of free quotas. somewhat shortened. Because goods exported to the EU will also receive the same free quotas as EU industries, the time and rhythm of the withdrawal of free carbon quotas will be crucial to the collection of carbon taxes.In this European Parliament plan, although the start of withdrawal is delayed by one year, the complete withdrawal time is three years earlier than the European Commission plan, which means that the pace of withdrawal will be accelerated, and for enterprises, it will actually leave a buffer Time is more limited.
Chart: Comparison of the differences in carbon border adjustment tax accounting between different plans
Source: European Parliament official website, CICC Research Institute
Analysis of the potential impact on Chinese companies
First, from the perspective of product taxation scope, the new plan is subject to The affected Sino-European trade volume will increase significantly, and the potential impact on my country's mid-stream and downstream enterprises will increase.
Compared with the European Commission plan passed last year, the "first reading" plan passed by the European Parliament this time expanded the scope of controlled products, adding chemicals and plastics industries to the original steel, aluminum, fertilizer and cement industries. , and expanded the scope of products included in the cement industry to include bauxite cement. According to 2021 trade data released by Eurostat, the EU's annual imports from China are 472 billion euros, accounting for 24.7% of the EU's total imports. If calculated in accordance with the newly determined scope of products subject to CBAM levy in the European Parliament's plan (excluding mid- and downstream complex products), the EU import volume of affected by CBAM from China will increase by 5.47 times from the European Commission's plan of 5.289 billion euros to 342.54 billion euros, accounting for 7.2% of the total trade volume between China and Europe.
Chart: Comparison of trade volume of affected industries between China and Europe under different plans
Source: Eurostat [29], CICC Research Institute
Note: 1) Unit is 100 million euros
In addition to the industries mentioned above, the existing midstream and downstream industries Whether the manufacturing industry will be affected has always been one of the focus issues on the scope of CBAM tax products. According to the European Parliament plan, the EU will introduce a timetable for expanding the product range before the end of June 2025, giving priority to industries with high carbon leakage risks and carbon emission intensity, and will join the current CBAM controlled products before the end of 2025. Downstream products, that is, existing midstream and downstream manufacturing products will be included in the taxation system before the official launch of CBAM in 2027. Although the list of midstream and downstream taxed products and specific implementation details have not been announced this time, according to the European Parliament’s plan, we believe that it will be more detrimental to my country’s midstream and downstream industries. On the one hand, the European Parliament's plan clearly includes the carbon emissions of intermediate inputs of complex products. refers to the calculation of implicit carbon emissions for complex commodities (mostly mid- and downstream manufacturing products in existing industries). This plan clearly considers not only direct emissions. , and incorporates carbon emissions from intermediate inputs used to manufacture complex goods. On the other hand, affected by the industrial structure and energy structure, the carbon emissions of intermediate products in my country's mid- and downstream industries account for a relatively high proportion. Taking the automobile industry as an example, the carbon emissions generated by my country's automobile assembly process are basically the same as those of other countries, or even slightly less. However, after considering the carbon emissions in the production process of intermediate inputs, the overall carbon emissions of my country's automobiles will increase significantly [30 ].
Chart: Proportion of carbon emissions from intermediate inputs in the automobile industry in different countries (2007)
Source: Energy demand and greenhouse gas emissions during the production of a passenger car in China30, CICC Research Institute
Second, Central and European carbon intensity reference Looking at the differences in standards, my country still has certain gaps in the values of some parameters, which may cause the relevant accounting results of enterprises to fail to pass EU CBAM certification.
The accounting of carbon emissions is directly related to the final amount of taxes paid by an enterprise, among which the accounting standard of carbon emission intensity is the key.Comparing the EU standards (EU ETS emission accounting standards) [31] and the carbon emission accounting standards issued by the China Standards Committee, the Ministry of Ecology and Environment, and the National Development and Reform Commission [32], is similar to relevant Chinese and European standards in terms of accounting boundaries and greenhouse gas ranges. And some regulations are more stringent in China. For example, China includes methane in the assessment scope; , but when it comes to specific accounting details and parameter settings, there are big differences between Chinese standards and EU standards. usually calculates carbon emissions according to Chinese standards. The intensity will be less than the EU standard. Take the electrolytic aluminum industry as an example:
Chart: The carbon emission intensity of the electrolytic aluminum industry reflects the difference between the Chinese and European reference standards
Source: European Commission, IPCC[33], National Development and Reform Commission, CICC Research Institute
Therefore, a On the one hand, it is necessary to promote the integration of my country's relevant standards with international standards such as IPCC and reduce the risks caused by different accounting standards for Chinese companies in the process of "going global"; on the other hand, Chinese companies should face up to the differences in relevant standards between China and Europe and make preparations in advance. Strictly calculate the carbon emission intensity of its products in accordance with EU standards to promote emission reduction while avoiding unnecessary losses due to violations of CBAM rules.
Third, the EU’s free carbon quota withdrawal time and pace seem to have been relaxed, but in fact the transformation window left for Chinese companies may be shortened.
The unit carbon tax standard is another key factor that affects the final amount of tax paid by enterprises. Among them, the carbon price difference and the free quota ratio between the exporting country and the EU are the main determining factors (as shown in the figure below). Since there is great uncertainty in the carbon price forecast, this report mainly focuses on the impact of the withdrawal time and intensity of free quotas on the unit tax price. Its impact on the carbon tax price standards that companies need to pay is as follows:
Assume that the basic carbon prices of my country and the EU are equal. The average carbon market price in 2021 is adopted and remains unchanged, that is, the EU: 56.8 euros/ton and China: 7.7 euros/ton. The European Commission plan stipulates that the free quota will be withdrawn at a rate of 10% per year in 2026 until it is completely withdrawn in 2035. The European Parliament plan stipulates that the withdrawal will begin in 2027, and the annual free quotas will be: 93% in 2027, 84% in 2028, 69% in 2029, 50% in 2030, 25% in 2031, and complete withdrawal in 2032. Before the formal implementation of CBAM and the complete withdrawal of free quotas (i.e. 2026-2035), the change trend of unit carbon tax price under the two plans is shown in the figure below.
Chart: Considering the impact of free carbon quotas on carbon tax price trends under different plans
Sources: European Commission, IPCC[34], National Development and Reform Commission, CICC Research Institute
Chart: Comparison of carbon emission intensity of the steel industry in China, the United States and Europe in 2020
Data Source: European Commission, CICC Research Institute
In comparison, although the European Parliament plan is officially implemented one year later, its transition period is short, and the subsequent unit carbon tax price rises significantly faster than the European Commission plan; the two plans in 2030 The price of unit carbon tax remains basically the same. In fact, if subsequent price fluctuations in the China-EU carbon markets are taken into account, the carbon price gap between the two countries is likely to widen further, especially in the near to medium term. Therefore, the transition period for the formal implementation of CBAM and the first few years before free quotas begin to be phased out will leave a certain window of time for Chinese enterprises to accelerate their green transformation.
Fourth, compared with the actual carbon emission levels of similar products in the EU, the average level of Chinese companies is higher, but there is uncertainty when compared with similar backward companies.
Because CBAM’s calculation of carbon emission intensity will use the default intensity calculation when the company cannot provide credible actual emission data, which is directly related to the average emission level of the industry in which the same product is located in China and Europe.
According to CICC Research Institute’s calculations, in 2019, the full life cycle carbon emission intensity of products in various departments in mainland China was generally about 2 to 4 times that of products in the same industry in the EU. Among them, for traditional energy-intensive and resource-intensive industries such as electricity (6.76 kg/USD), non-metallic mineral products (3.00 kg/USD), and metal products (1.82 kg/USD), the emission intensity of mainland China products is the EU 3.3 times, 2.4 times, and 4 times the level [35].
The European Union has also measured the carbon emission intensity of Chinese and European products. According to its official report [36], taking steel as an example, the carbon emission intensity of China's two technical route products in 2020 is significantly higher than that of EU companies. Among them, electric furnace steelmaking technology The carbon emission intensity of China is much higher than that of the EU and other countries. The carbon emission intensity of blast furnace steelmaking technology is higher than that of the EU but roughly the same as that of the United States.
Taken together, the average carbon emission intensity of Chinese enterprises is significantly higher than the average carbon emission intensity of the EU. However, based on this, we can judge whether the average level of the bottom 5% of companies in the EU is higher or lower than the average level of the bottom 10% of Chinese companies. There is still great uncertainty in which default value is more beneficial to Chinese companies. How does
respond to the EU carbon border adjustment mechanism?
How should affected companies respond?
For high-energy-consuming enterprises with a large share of domestic exports to the EU, due to the large carbon price difference between domestic and EU, carbon costs will inevitably increase after the implementation of the carbon tariff mechanism, and there is a risk of profit squeeze. At the same time, if emission intensity is significantly higher than the industry average, high carbon costs may lead to lower demand and reduced exports. Domestic energy-intensive enterprises with large export exposure can prepare countermeasures from the following aspects:
) Pay attention to adapting to EU rules and improve the carbon emission monitoring and accounting system. During the policy transition period (2023~2025 or 2023~2026), although actual taxation will not begin, carbon emission declarations will begin in advance. Importers need to declare the total import volume of the quarter on a quarterly basis. Direct and indirect emissions of products will be in the original amount. The carbon price corresponding to the producing country, etc. In terms of carbon emission accounting, if the imported products can provide emission level certification, the EU will tax based on the verified actual emission level. If the emission level certification cannot be provided, the default value will be calculated, and the default value must be higher than actual emission levels. Therefore, under the carbon border adjustment mechanism, carbon emission data is the tax base for future carbon tariffs, and companies that can provide actual emission certificates have a competitive advantage. It is recommended that export enterprises need to establish and improve carbon emission monitoring and accounting systems as soon as possible to form the ability to independently provide product carbon footprint data. Strive for corresponding carbon tariff deductions and provide a reliable basis for any disputes over emission data that may arise in the implementation of carbon tariffs in the future. In specific operations, on the one hand, according to the enterprise's own affordability, greenhouse gas monitoring equipment can be installed in each link of production as appropriate to increase the transparency and reliability of measured carbon emissions, establish a unified carbon emissions database, and improve carbon data supervision and storage. management and environmental modeling; on the other hand, we can pay attention to the progress of international carbon emission accounting methods and promote mutual recognition of accounting and assessment methods with foreign countries.
) Take the initiative to communicate with import manufacturers and open up channels for mutual recognition of carbon emissions. The CBAM proposal has a third-party verification mechanism. Importers should ensure that the declared emissions have been verified by a recognized verification agency. Therefore, exporters need to communicate and negotiate with different importers respectively about carbon data verification responsibilities, and obtain the verification results from the importer. recognition, which increases the cost of communication and mutual recognition. In practice, the proposal also provides a more convenient mutual recognition channel for exporters, stipulating that they can apply for registration with the CBAM authority, and then have their products included in the European Commission's unified database after verification by a third-party verification agency. Within five years, During the validity period, any importer in the EU can directly use the verified information in the unified database. Before CBAM is officially implemented, companies can proactively negotiate with different importers in advance on the accounting and accounting methods of carbon emission data, or plan to register through official channels to reduce communication costs.
) During the policy transition period, optimize the energy consumption structure through technological upgrades and reduce carbon emission intensity. After the implementation of the carbon tariff, it is inevitable that the environmental costs of corporate operations will increase. The transition period can be used to build an internal carbon pricing system and incorporate environmental cost considerations into the core business operations and investment decisions. On the one hand, energy efficiency can be improved through technological upgrading to avoid higher cost increments and weakening market competitiveness due to lower carbon emission intensity than the industry average; on the other hand, carbon emissions can be reduced by optimizing the energy consumption structure. For enterprises with high technical level and limited room for energy efficiency improvement, it is recommended to reduce direct and indirect carbon emission intensity by optimizing the energy consumption structure, especially increasing the proportion of green electricity in the electricity consumption structure.For example, in the electrolytic aluminum industry, most carbon emissions in production come from indirect emissions from electricity use. If green electricity is used to replace coal power, the carbon emission intensity will be significantly reduced. For enterprises with larger plant areas, more stable operations, and the ability to install rooftop photovoltaics, they can consider building their own rooftop photovoltaics and consuming green electricity through self-consumption. The cost of electricity consumption is lower than that of grid electricity, and at the same time, the cost of export carbon can be significantly reduced. If you do not have the conditions to build your own rooftop photovoltaics, you can consider trading green electricity and green certificates to directly offset the company's actual emissions and obtain corresponding environmental rights.
) Make plans to diversify exports in advance and stabilize the fundamentals of foreign trade. If after a company upgrades its technology to improve energy efficiency and optimize its energy consumption structure, due to the carbon price gap between China and Europe, the carbon tariff tax base is still large, and the increased carbon costs are difficult to pass on to EU users, then exports to the EU will be negatively impacted. Influence. Export-oriented companies should actively build a diversified trade development strategy, expand new markets and new customers around the world, especially increase the share of exports to emerging economies, and make up for the possible decline in exports to Europe. If necessary, we can consider increasing foreign direct investment based on our own strength and alleviate pressure through trade diversion and other methods.
How should investors respond? Related investment suggestions
For investors in related fields, they can pay attention to the changes in the industry competition pattern after the increase in corporate carbon costs, the increase in the investment value of clean energy operators after the appreciation of environmental rights, and the opportunities in the carbon monitoring and evaluation segment driven by companies' response to carbon tariff rules. :
) The differentiation or acceleration of energy-intensive industries will benefit technology leaders. In response to the EU carbon tariff policy, domestic carbon pricing policies for high-energy-consuming industries may be accelerated, and carbon prices may increase compared to the current level. Against the background of high carbon costs at home and abroad, powerful leading companies have further reduced their carbon emission intensity through technological upgrading and expanded their competitive advantages. At the same time, leading companies have strong bargaining power and are more advantageous in transmitting cost increases downstream. Therefore, leading companies in high-energy-consuming industries included in the scope of carbon tariffs are expected to take this opportunity to further upgrade their technologies and gain more market share, accelerating the elimination of small and medium-sized enterprises.
) New energy operators and upstream equipment suppliers benefit from the increased value of environmental rights and interests. In order to reduce carbon emission intensity, high energy-consuming enterprises have increased demand for clean energy consumption and increased the value of various environmental rights and interests. As providers of environmental rights and interests, new energy operators’ income (green power premium) is expected to further increase. At the same time, the demand for rooftop photovoltaic industrial and commercial projects has increased, and new energy upstream equipment manufacturing companies and supporting construction companies, such as photovoltaic component manufacturers and installers, have benefited.
) The demand for carbon monitoring and accounting services is increasing. At present, domestic manufacturers generally have little experience in carbon monitoring, accounting and evaluation. In order to cope with future carbon tariff requirements, the demand for corporate layout monitoring and accounting systems will increase significantly. Carbon monitoring equipment manufacturers, accounting and solution providers will benefit during this period.
Carbon neutrality related industry and corporate trends
This chapter will be based on the analysis and forecasts of various industry groups of CICC Research Department, tracking the theme trends in the "dual carbon" field from both industry and corporate levels, and helping investors seize "carbon neutrality" bring investment opportunities while avoiding related risks.
Carbon neutral transformation industry dynamics tracking
Chart: Industry policy tracking
Source: Wind, government websites such as the National Development and Reform Commission and the Ministry of Industry and Information Technology, CICC Research
Coal industry
► National Bureau of Statistics: National coal mining and The washing and separation industry achieved a profit of 448.9 billion yuan, a year-on-year increase of 175%
National Bureau of Statistics profit data of industrial enterprises above designated size from January to May showed that industrial enterprises above designated size achieved operating income of 53.16 trillion yuan, a year-on-year increase of 9.1%. Mining business revenue was 2,748.29 billion yuan, a year-on-year increase of 41.3%. Among them, the coal mining and washing industry achieved main business income of 1,657.06 billion yuan, a year-on-year increase of 60.8%.[37]
► Guangzhou City is stepping up its efforts to promote the implementation of energy projects and strive for a new batch of clean coal power projects to comply with the regulations.
html On June 23, the Guangzhou Municipal People's Government issued the "Guangzhou City Implements the State Council's "Package of Policies and Measures to Solidly Stabilize the Economy" Notice of the Implementation Plan. The notice proposes to speed up the implementation of a number of energy projects. Accelerate the construction of a number of backbone power grid projects, complete and put into operation the Guangdong Huadu natural gas cogeneration project and the Guangdong Power Grid DC back-to-back Guangzhou project, adding 920,000 kilowatts of backbone power grid installed capacity. Coordinate and promote the construction of "gas-replacing coal" natural gas heat, power and cooling cogeneration projects in the eastern district of Guangzhou Development Zone, and the second phase backbone power supply of the Zhujiang LNG power plant; start the construction of the "gas-replacing coal" power supply project of Huangpu Power Plant; accelerate the implementation of Baiyun Hengyun natural gas power generation, Conghua University Tang gas power generation and other power supply project construction land will be used to promote the construction of gas supply pipelines for power supply projects. [38]Steel industry
► Six departments including the Ministry of Industry and Information Technology: By 2025, the energy efficiency of products in steel and other industries will reach international levels
Six departments including the Ministry of Industry and Information Technology issued an action plan to improve industrial energy efficiency. By 2025, the energy efficiency of key industrial industries will be comprehensively improved, the energy efficiency of key areas such as data centers will be significantly improved, the proportion of green and low-carbon energy utilization will be significantly increased, energy-saving and efficiency-improving technology and equipment will be widely used, standards, services and supervision systems will be gradually improved, steel, petrochemicals, etc. The energy efficiency of key products in the chemical industry, nonferrous metals, building materials and other industries has reached the international advanced level, and the energy consumption of the added value of industrial units above designated size has dropped by 13.5% compared with 2020. Making the best use of energy and putting efficiency first has become a common concept and common requirement among market entities and the public. Energy conservation and efficiency improvement have further become the green and low-carbon "first energy source" and the primary measure for reducing consumption and carbon emissions. [39]
► China’s net exports of stainless steel increased by 80% month-on-month in May, hitting a new high since the beginning of the year.
The General Administration of Customs released statistics on my country’s stainless steel import and export in May. In May, domestic net exports of stainless steel were 256,900 tons, a month-on-month increase of 114,200 tons, an increase of 80%; a year-on-year increase of 193,400 tons, an increase of 304.5%, setting a new high for net exports since the beginning of this year. From January to May, the total domestic net export volume of stainless steel was 516,900 tons, a year-on-year decrease of 21,100 tons, or 3.92%. [40]
Non-ferrous industry
►Ministry of Industry and Information Technology: Currently, lithium resources are still running at a high level, and we will do a good job in guaranteeing power battery resources and materials from three aspects
The deputy director of the Equipment Industry Department of the Ministry of Industry and Information Technology said that currently lithium resources are still running at a high level, and at the same time Raw materials such as cobalt, nickel and petroleum coke used in graphite anodes have also increased significantly in price, putting great pressure on the production and operation of enterprises. In the next step, the Ministry of Industry and Information Technology will do a good job in ensuring the supply of power battery resources and materials from three aspects: first, to guide upstream and downstream enterprises to strengthen the connection between supply and demand, establish stable cooperative relationships through signing long-term agreements, etc., and coordinate to deal with the risks of resource supply and price fluctuations; second, to accelerate Promote the development and utilization of domestic resources, guide local authorities to ensure the production factors of relevant enterprises, continue to improve domestic resource supply levels, and support leading enterprises to jointly develop overseas resources in accordance with international rules; third, promote the comprehensive utilization of renewable resources, study and formulate lithium, etc. Renewable raw material standards, improve the power battery recycling system, and promote the recycling of more recyclable resources. [41]
Carbon-neutral growth industry
"Dual Carbon" Index Performance Review
The dual carbon index continues to pick up, and industry scale growth and demand expansion are gradually realized. As policies to stabilize growth are gradually implemented and the short-term impact of the epidemic gradually subsides, the low-carbon industry index and related industries continue to rebound, and industrial chains such as photovoltaics and new energy maintain prosperity. In the past two weeks (June 22 to July 5), the CICC Low Carbon Industry Index rose 8.6%, higher than the CSI 300 Index (3.9%) and the Hang Seng Index (1.3%). Since the beginning of 2022, the low-carbon industry index has increased by 1.6%, outperforming the CSI 300 and Hang Seng Index by 10.6ppt and 8.3ppt respectively.
Carbon neutrality-related industries continued to rebound after continuous corrections, with energy storage, power batteries and new energy vehicle sectors leading the gains. In terms of industries, the carbon neutrality-related growth industry index has increased overall in the past two weeks.Recently, energy storage projects reaching 1GW have been launched in many places, and domestic installed capacity is expected to accelerate in the second half of the year. At the same time, the National Energy Administration has emphasized the safety requirements of electrochemical energy storage power stations, and the energy storage concept led the market, with an increase of 9.9%. The concept of all-vanadium flow batteries, which benefited from the energy storage segment, led the gains, with power batteries rising by 9.0%. At the same time, thanks to the recovery of the supply chain and the stimulation of automobile consumption policies, the new energy vehicle industry chain maintained high prosperity, with new energy vehicles increasing by 7.5%.
Chart: Carbon neutrality concept index trend in the past two weeks
Source: Wind, CICC Research Department Note: Data as of July 5, 2022
Chart: Carbon neutrality related industry index rise and fall in the past 2 weeks
Data Source: Wind, CICC Research Note: Data as of July 5, 2022
Photovoltaic industry chain
Photovoltaic industry chain prices are rising. As of July 5, the photovoltaic managers' industry-wide index increased by 2.3% from two weeks ago, with the upstream and midstream manufacturing and downstream power plants rising by 2.6% and 1.0% respectively. In terms of price, the comprehensive price index of the photovoltaic industry increased by 2.9% compared with two weeks ago. Among them, the price index of polysilicon and silicon wafers increased significantly, rising by 7.1% and 3.6% respectively. The price index of cells and modules increased by 0.6% and 0.2% respectively.
Overseas market demand may stabilize at a high level, the efficiency of the domestic photovoltaic industry continues to improve, and the domestic industry accounts for a far leading share of the world. The European Union has proposed special photovoltaic goals and action plans [42], which has driven the rapid increase in energy storage capacity. Coupled with the continued strong demand for distributed energy in the United States, the high-speed growth overseas is expected to be maintained. Domestically, the concentration of silicon materials and silicon wafers in the middle and upper reaches of the photovoltaic industry chain continues to increase, and the middle and lower reaches continue to apply new technologies to improve efficiency. Coupled with the strong demand for many projects in the Chinese market, we are optimistic that the profitability of Chinese companies will be restored.
Chart: Photovoltaic managers index
Source: Wind, CICC Research
Chart: Photovoltaic industry comprehensive price index
Source: Wind, CICC Research
New energy industry chain
html New energy vehicles continued to recover strongly in June , the delivery volume of many car companies hit record highs. Xiaopeng delivered 15,295 vehicles in June, a year-on-year increase of 133%; Ideal delivered 13,024 vehicles in June, a year-on-year increase of 69%; Weilai delivered 12,961 vehicles in June, a monthly high, a year-on-year increase of 60%; BYD's new energy vehicle sales in June 134,000 vehicles, a new monthly sales high, a year-on-year increase of 224%, among which the sales of pure electric models increased significantly, with a month-on-month increase of 30%. Overall, with the orderly advancement of the resumption of work and production, sales of new energy vehicles continued to increase year-on-year in June, and the demand side has strong resilience.
Seven departments in Beijing issued a consumption plan to encourage car replacement and subsidize the replacement of passenger cars with new energy sources. On June 26, 7 departments including the Beijing Municipal Bureau of Commerce issued the "Beijing Plan on Encouraging Automobile Upgrading and Renewal Consumption", which proposed that between 0:00 on June 1, 2022 and 24:00 on December 31, 2022, scrap or transfer out of new energy vehicles Passenger cars or other passenger cars that have been used for 1 to 6 years can enjoy a subsidy of 8,000 yuan; scrapped or transferred out other passenger cars that are more than 6 years old (inclusive) can enjoy a subsidy of 10,000 yuan. Among them, the subsidy conditions must be met. The natural person owner scraps or transfers the passenger car registered in his or her name for more than 1 year in this city, and purchases a new new energy passenger car from a Beijing automobile sales enterprise and issues a "Unified Motor Vehicle Sales Invoice" , and complete the registration procedures for newly purchased new energy passenger cars before February 28, 2023. [43] We believe that policy subsidies can optimize the automobile structure in Beijing and promote the growth of automobile consumption. We are optimistic that the penetration rate of new energy vehicles will further increase.
Chart: Forecast of industry trends
Source: China Expo, CICC Research
Corporate “dual carbon” action
Chart: State-owned and central enterprises’ “dual carbon” action tracking
Source: Wind, company official website, CICC Research
Sustainable finance and ESG
Green credit, green bonds, green stock index and other products, as well as green development funds, green insurance, carbon finance and other financial instruments have played a crucial role in promoting the "internalization" of the externalities of economic activities.
Green Bonds
China’s green bond stock is approximately 1.67 trillion yuan. According to Wind data, as of July 6, 2022, there are 1,516 labeled green bonds in China, with an inventory size of 1.67 trillion yuan. In terms of issuance pace, a total of 49 new green bonds were issued in June, with an issuance scale of RMB 61.19 billion, a year-on-year decrease of 15.1% from the issuance scale of RMB 72.06 billion in May. Since the beginning of July, 13 green bonds have been issued, with a scale of RMB 5.10 billion.
The stock of carbon-neutral bonds is 163.6 billion yuan, accounting for 9.8% of the total balance of green bonds. As of July 6, 2022, there are 130 domestic carbon-neutral bonds in stock, with an inventory scale of 163.6 billion yuan, accounting for 9.8% of the total balance of green bonds. A total of 6 new carbon-neutral bonds were issued in June, with an issuance scale of 11.41 billion yuan, a year-on-year decrease of 24.2% from the 15.05 billion yuan issuance scale in May. The investment areas are mainly power, transportation and diversified financial industries.
Chart: China’s domestic labeled green bond stock size
Source: Wind, CICC Research Note: Data as of July 6, 2022
Chart: China’s domestic labeled green bond issuance rhythm
Source: Wind, China Note from the Research Department of Gold Company: Data as of July 6, 2022
Carbon market dynamics
The trading activity of the national carbon market is the same as in the previous period, and Beijing’s carbon price is showing an upward trend. As of July 4, 2022, the closing price of the national carbon market was 59 yuan per ton, which was basically the same as the closing price of 60 yuan per ton two weeks ago (June 22, 2022). A total of 845,000 tons were traded in the national carbon market, with a total transaction value of 48.85 million yuan. In the second quarter of 2022, the national carbon market price continued to fluctuate within a narrow range of 59 yuan per ton, and the total transaction volume of 4.48 million tons was relatively sluggish. In terms of local carbon markets, carbon prices in places such as Chongqing, Shanghai and Fujian have weakened. Carbon prices in Beijing showed an upward trend, closing at 85.2 yuan per ton on July 4, an increase of 20% from 71 yuan per ton on June 21.
EU carbon market reform will drive up carbon prices. The EU carbon price has fluctuated at a high of 85 euros per ton in the past two weeks. The closing price on July 4 was 84.16 euros per ton, an increase of 3.4% from two weeks ago (June 22). On June 22, the EU carbon market reform plan was passed in the second vote of the European Parliament22, which involves the access restriction policy for investors, but the policy does not involve the derivatives (futures and options) market, so the carbon There was a mild sell-off in the market, with carbon prices falling to €81.42/ton. But then carbon prices began to cover again as hedging demand re-emerged after options expired. From June 27 to July 1, the EU carbon market “Fit for 55” reform plan was officially passed by the European Parliament [44]. Carbon market investors continued to buy steadily, pushing the carbon price to nearly 90 euros/ tons level.
Chart: National carbon market carbon emission quota transaction price and volume
Source: Wind, CICC Research Note: Data as of July 5, 2022
Chart: China and EU carbon market price trends
Source: Wind , CICC Research Department Note: Data as of July 5, 2022
Chart: Average transaction price of China’s 7 provincial and municipal pilot markets for carbon emissions trading
Source: Wind, CICC Research Department Note: Data as of July 2022
ESG event tracking on June 5
Domestic: Build a digital government and promote the realization of dual carbon goals
►The central bank will continue to promote international cooperation in green finance through multilateral and bilateral platforms
On June 27, Yi Gang, governor of the People's Bank of China, said in an exclusive interview that the central bank can play a role in the green transition. In terms of monetary policy, the first and most important responsibility of the central bank is to maintain price stability. However, the central bank still has policy space to promote green transformation through structural monetary policy. As of March 2022, China's green loan balance has exceeded 18 trillion yuan, growing rapidly. The balance of green bonds in China is approximately 1.3 trillion yuan, ranking among the top in the world. In the next step, the People's Bank of China will continue to promote international cooperation in green finance through multilateral and bilateral platforms to better serve the goals of carbon peaking and carbon neutrality.
► Build a digital government and promote the realization of dual carbon goals
html On June 23, the State Council issued the "Guiding Opinions on Strengthening the Construction of Digital Government", which will proactively comply with the trend of economic and social digital transformation, fully release the dividends of digital development, and comprehensively create a new era of digital government construction. Make arrangements for the situation. The "Opinions" pointed out that promoting green and low-carbon transformation. Accelerate the construction of a carbon emission intelligent monitoring and dynamic accounting system, promote the formation of a new green and low-carbon development pattern of intensive conservation, recycling, efficiency, and inclusive sharing, and serve to ensure the smooth realization of carbon peak and carbon neutral goals.► Seven departments revised the "China Clean Development Mechanism Fund Management Measures": expanding support for carbon peak and carbon neutrality
html On June 28, seven departments including the Ministry of Finance and the Ministry of Ecology and Environment revised and announced the "China Clean Development Mechanism Fund Management Measures" (hereinafter referred to as the "Measures") will come into effect on August 1, 2022. This "Measures" moderately broadens the scope of use of the fund. On the basis of retaining the stipulation that the purpose of the fund is "supporting the country's response to climate change", it also adds "supporting green and low-carbon activities such as carbon peak carbon neutrality, pollution prevention and ecological protection, etc." fields and promote high-quality economic and social development.►ESG Global Leaders Summit discusses green finance, technological innovation and other ESG hot topics
The second ESG Global Leaders Summit, guided by the Department of Climate Change Response of the Ministry of Ecology and Environment and co-organized by CITIC Publishing Group, will be held from June 28, 2022 to It was held online on the 30th, with the theme focusing on "jointly promoting global ESG development and building a sustainable future." A number of financial experts expressed their opinions on topics such as "Difficulties and Challenges of Breaking Responsible Investment" and "ESG Helps Achieve the 30·60 Dual Carbon Targets", and discussed hot topics related to financial institutions' ESG, green finance, technological innovation and other related hot topics.
► "General Principles for Corporate ESG Information Disclosure" and "General Principles for Corporate ESG Evaluation" were released
On June 25, two group standards, "General Principles for Corporate ESG Information Disclosure" and "General Principles for Corporate ESG Evaluation" were officially released and will be launched on June 26, 2022. It will be officially implemented from now on. The two "General Principles" have the four characteristics of adhering to goal orientation, Chinese characteristics, inclusiveness, and reform and innovation. Their more important value lies in their future application in economic and social development. They are the key to my country's construction of an ESG standard system and the creation of a market-oriented, legal-based, The first step to an international business environment.
►Shanghai Environment Exchange takes the lead in building the "EATNS" carbon management system to help companies adapt to the carbon market.
html On June 24, the EATNS Carbon Management System Expert Committee and Assessment Working Committee were officially established in Shanghai. EATNS carbon management system is the world's first comprehensive carbon management system standard led by Shanghai Environment and Energy Exchange. Next, the assessment working committee will further improve the EATNS carbon management system segmented industry standards, actively serve the national "double carbon" goal and the high-quality development of the national carbon market; promote the internationalization of the EATNS carbon management system standard, and provide support services for the international trade of enterprises. ; Deepen the implementation of the EATNS carbon management system assessment work and strengthen the management of the standard implementation and assessment process.► Shanghai Pudong will establish corporate and personal carbon accounts
"Several Provisions on the Development of Green Finance in Pudong New Area, Shanghai" was adopted at the 41st meeting of the Standing Committee of the 15th Shanghai People's Congress and will be effective on July 1, 2022 Be implemented. The People's Government of Pudong New Area should rely on the green financial data service special library to carry out digital collaboration with various third-party institutions, explore the establishment of corporate carbon accounts and natural person (permanent population) carbon accounts, and integrate corporate carbon emission performance information and personal green and low-carbon activity information Incorporate into carbon accounts and form carbon points.
International: The EU carbon tariff vote finally passed
►IMF President: The common global goal should include carbon neutrality and sustainable development
The President of the International Monetary Fund (IMF) attended the second ESG Global Leaders Summit, in "Sustainability The IMF sent a congratulatory letter during the "Global Opportunities and Challenges for Development" session, stating that the IMF welcomes China to improve its green finance framework by further developing green bond classification standards, piloting new information sharing platforms, and improving environmental information disclosure by enterprises and financial institutions.As the world adapts and prepares for a world more vulnerable to shocks, Georgieva said shared global goals should include carbon neutrality and sustainable development. Tackling climate change requires a holistic approach that brings together environmental, social and governance issues, with appropriate policy incentives.
► 27 EU countries reached a new climate change agreement
EU countries reached an agreement on climate change proposals in the early morning of June 29, local time, supporting the gradual cessation of the sale of fossil fuel vehicles in 2035. New cars sold from 2035 must be Zero carbon emissions, which indicates that the EU will ban the sale of internal combustion engine cars. EU officials also agreed to set up a 59 billion euro EU fund to protect low-income citizens from having to pay the high costs of carbon reduction from 2027 to 2032.
► EU market regulator publishes ESG ratings market assessment
European market regulator European Markets and Securities Authority (ESMA) published its assessment of ESG rating providers on June 27, which is the next step in the EU's process of regulating the ESG ratings market. . The announcement follows a "call for evidence" launched by the regulator earlier this year to provide regulators with "a picture of the size, structure, resources, revenue and product offerings of the different ESG ratings providers operating in the EU", as well as information from ESG Ratings Feedback from users and companies covered by the ratings.
► British Infrastructure Bank invests 22 billion pounds to combat climate change
On June 23, the British Infrastructure Bank announced that it will invest 22 billion pounds to combat climate change and promote regional growth. This plan will make clean energy the largest investment area. The bank plans to invest in other key areas for the UK’s economic future, including transport, digital, water and waste, providing finance to scale up existing infrastructure and accelerate the deployment of new technologies.
Dual Carbon Report Viewpoint
International Energy Agency (IEA): "World Energy Investment Report 2022"
On June 22, the International Energy Agency (IEA) released the "World Energy Investment Report 2022". The report updates investment in 2021 and full-year forecasts for 2022 prospects, and examines how investors assess risks and opportunities in areas such as fuel and power supplies and critical minerals against the backdrop of uncertain events in 2022. Efficiency and R&D. [45] The main points of the report are:
► Against the background of global energy supply shortage, total global energy investment is expected to increase by 8% in 2022, reaching 2.4 trillion US dollars, much higher than the level before the new crown epidemic in 2019. The main growth of comes from clean energy, but it is still not enough to solve the current multi-dimensional energy and climate problems. We should continue to increase investment, improve energy efficiency, and accelerate the transformation of clean energy. Investment in fossil fuel supplies is the only area that overall remains below pre-pandemic levels in 2019. But soaring fossil fuel prices have resulted in huge profits for suppliers. Net revenues for global oil and gas producers will double to an unprecedented $4 trillion by 2022.
► Renewable energy, efficiency improvements and electric vehicles are leading the charge for clean energy. Clean energy investment is beginning to pick up and is expected to exceed $1.4 trillion by 2022, accounting for nearly three-quarters of overall energy investment growth. Renewable energy is at the heart of this positive trend, with renewables, grids and energy storage now accounting for more than 80% of total investment in the power industry. Investment in efficiency is another major area of growth, driven by rising fuel prices and government incentives. Investment in building energy efficiency increased by 16% in 2021, the largest annual increase since the report tracked investment amounts. Mobile electrification is a key factor in rising consumer spending on clean terminals. Electric vehicle sales will more than double year-on-year in 2021 and will continue to grow strongly in 2022.
► Accelerating investment in emerging and developing economies is critical to promoting the energy transition and energy security. Many emerging and developing economies rely more heavily on public resources for investment; in these economies, state-owned enterprises account for about half of energy investment.But public funds are often scarce, many state-owned utilities are heavily indebted, and a deteriorating global economic outlook has reduced governments’ ability to finance energy projects. In the absence of supportive policies, high prices do not help promote more sustainable options, especially in poorer countries. Energy shortages could force millions of people back into energy poverty. Nearly 90 million people in Asia and Africa previously had access to electricity but are now unable to pay for basic energy needs. More needs to be done to bridge the gap between emerging and developing economies’ one-fifth share of global clean energy investment and their two-thirds share of the world’s population. Additional financial and technical support, including concessional capital, private sector capital and financial inflows from international carbon markets, are critical.
► Fossil fuel investments are reacting to price signals. Currently, investment in fossil fuels is on the rise but is still nearly 30% lower than when the Paris Agreement was signed. In some regions, the shift away from Russian supplies of fossil fuels toward diversifying supply channels and resolving recent market tensions has strengthened cyclical incentives to invest in periods of high prices. However, due to high policy uncertainty and difficulty in obtaining financing, the response of investment to prices is limited. Coal supply investment is much less capital intensive than oil and gas and is less affected by larger year-over-year changes. Investment in the coal supply chain in 2021 will be approximately US$105 billion, a year-on-year increase of 10%. Due to tight energy supplies, the IEA expects investment to grow by a further 10% in 2022. This is a far cry from market conditions expected from international climate targets and Glasgow’s commitment to “phase out” coal. The refining industry saw global refining capacity fall for the first time in 2021, as a 1.8 million barrel-per-day decline outpaced relatively modest capacity additions in China and the Middle East. This has led to a rapid rise in refining margins in 2022 during a global energy supply shortage. But given that the long-term outlook for oil demand remains uncertain, strong financial performance and high utilization rates in recent months will not necessarily translate into higher investment levels.
► Critical minerals have the potential to reverse the trend of falling costs for clean energy technologies. This year’s report is the first to provide a detailed review of investment trends in key minerals for the energy transition, specifically lithium, cobalt, nickel, copper and aluminum. Prices for these critical minerals are rising more than at any time in the 2010s due to increased demand, supply chain disruptions and concerns about tightening supplies. Soaring prices are (temporarily) a major factor in reversing the downward trend in the costs of some clean energy technologies. The share of cathode material costs (including lithium, nickel, cobalt and manganese) in electric vehicle battery costs has risen from 5% in the mid-2010s to more than 20% today, with approximately 300 new gigafactories currently planned. Building and construction. Supply issues in Russia added to market tensions. Unlike fossil fuels, rising prices for key minerals are accompanied by expectations of rapid growth in demand, helping to support expanded investment plans. The IEA expects investment growth to remain strong in 2022.
► Sustainable finance faces growing pains but remains important for financing clean energy. The financial health of 's clean energy businesses has been shaky in recent years, but many publicly traded energy-related companies are starting 2022 with relatively strong balance sheets. Measures of liquidity, profitability and stock market valuations have all improved or remained stable compared with the year before the pandemic. However, this positive sign for energy investment is not universal, and many (often state-owned) energy companies in emerging and developing economies remain under severe financial pressure. The rise of sustainable finance offers significant opportunities for the energy transition, but its impact is concentrated in advanced economies. Sustainable bond issuance exceeded $1.7 trillion in 2021, with the vast majority aimed at financing renewable energy and low-carbon buildings and transportation. For emerging market and developing economies (EMDEs), although sustainable bonds have proven to be an effective way to access capital, accounting for a large portion of their total issuance, absolute values remain low compared with advanced economies. .
► Current energy investment trends show that the world is failing to meet climate goals. Although global investment in clean energy has increased significantly, current global investment is still insufficient to achieve climate change goals.Without significant increases in spending on efficiency, electrification and low-carbon supply, growing global demand for energy services may not be met in a sustainable way. Policymakers need to address many non-market barriers to urgently strengthen clean energy supply chains, such as licensing requirements and preferential arrangements for existing producers and technologies. Higher and more diverse investment in critical minerals is also an important part of the solution, as is greater support for innovation and emerging clean technologies.
British Petroleum Company (bp): "bp World Energy Statistical Yearbook 2022"
On June 28, bp released the "bp World Energy Statistical Yearbook 2022". The report pointed out that the global energy system is facing the most severe challenges and uncertainties in the past 50 years. The current energy supply shortage and soaring prices have made how to solve the "security", "economic" and "low carbon" energy trilemma increasingly important. Hair is important. [46] The main points of the report are:
► In 2021, global energy demand and carbon emissions will basically return to the levels before the COVID-19 pandemic in 2019, reversing the temporary decline in 2020 due to the COVID-19 pandemic. Global primary energy demand will grow by 5.8% in 2021, 1.3% higher than 2019 levels. Renewable energy increased by more than 8 exajoules between 2019 and 2021. Consumption of fossil fuels has remained essentially unchanged. Fossil fuels accounted for 82% of primary energy use last year, down from 83% in 2019 and 85% five years ago. The rise in carbon emissions in 2021 is driven by a rebound in economic growth. CO2 emissions from energy consumption, industrial processes, combustion and methane (measured in CO2e) rose by 5.7% in 2021 to 39 billion tonnes of CO2e. Carbon emissions generated by the energy industry increased by 5.9% year-on-year to 33.9 billion tons of carbon dioxide equivalent, close to 2019 levels. Methane, carbon dioxide emissions from industrial processes and emissions from combustion experienced relatively smaller increases year-on-year, at 4.6% and 2.9% respectively.
► Oil demand in 2021 remains below 2019 levels. Global oil production increased by 1.4 million barrels per day in 2021, with OPEC+ accounting for more than three-quarters of the increase. Oil prices averaged $70.91 per barrel, the second highest level since 2015; oil consumption increased by 5.3 million barrels per day, but was still 3.7 million barrels per day below 2019 levels. Most of the consumption growth came from gasoline (1.8 million barrels per day) and diesel/diesel (1.3 million barrels per day). Regionally, most of the growth occurred in the United States (1.5 million barrels per day), China (1.3 million barrels per day) and the European Union (570,000 barrels per day).
► Global natural gas demand will grow by 5.3% in 2021, which is higher than the pre-epidemic level in 2019, exceeding 4 trillion cubic meters for the first time. Global liquefied natural gas (LNG) supply increased by 5.6% in 2021, reaching 516 billion cubic meters. The increase was the lowest since 2015 (except for 2020). U.S. LNG supply growth of 34 billion cubic meters accounted for nearly all new growth and offset declines from other Atlantic Basin gas exporters. China has surpassed Japan to become the world's largest LNG importer, accounting for nearly 60% of global LNG demand growth in 2021. Algeria’s pipeline natural gas exports to Europe are the largest incremental source of pipeline LNG in Europe, followed by Azerbaijan. In 2021, Russia's pipeline supply to Europe was generally stable at 167 billion cubic meters, but exports to EU countries fell by 8.2%. In 2021, global natural gas prices rebounded strongly. The prices of European TTF, Asian JKM and American Henry Hub increased by approximately four times, two times and one time respectively.
► Global coal consumption will grow by more than 6% in 2021, reaching 160 exajoules, the highest level since 2014. China and India account for more than 70% of coal demand growth in 2021, with increases of 3.7 exajoules and 2.7 exajoules respectively. Coal prices have risen sharply in 2021, with European prices averaging $121/ton and Asian prices averaging $145/ton, the highest levels since 2008. In 2021, global coal production and consumption will grow simultaneously, with an increase of 440 million tons. Growth still mainly comes from China and India, with most coal production used for domestic consumption; Indonesia also accounts for a considerable part of the increase in coal production, mainly for more exports. It is worth noting that coal consumption in Europe and North America increased in 2021 after nearly 10 years of continuous decline.
► Global electricity generation increased by 6.2% in 2021, similar to the strong rebound after the 2010 financial crisis (6.4%). Wind energy and solar energy reached 10.2% of electricity generation in 2021. For the first time, wind energy and solar energy provided more than 10% of global electricity, surpassing nuclear power's share. By 2021, coal will still be the main fuel for power generation, with its share increasing from 35.1% in 2020 to 36%. In 2021, natural gas power generation increased by 2.6%, although its share fell from 23.7% in 2020 to 22.9% in 2021.
► In 2021, global non-hydropower renewable energy (including biofuels) consumption will grow by approximately 5.1 exajoules, an annual increase of 15%, which is higher than the growth rate of any other fuel in 2021. Solar and wind capacity will increase by 226GW in 2021, close to 2020’s record 236GW growth. China remains the main driver of solar and wind energy capacity growth, accounting for 36% and 40% of global solar and wind power installed capacity growth in 2021, respectively. Global hydropower production fell by about 1.4% in 2021, the first decline since 2015. In contrast, nuclear power generation increased by 4.2%, also driven mainly by China.
►Critical mineral prices increased in 2021 and maintained an upward trend in 2022. Global cobalt prices increased by 63% in 2021, averaging US$51,000/ton. Lithium carbonate prices rose 58% to an average of US$11,000/ton. In 2021, global lithium production increased significantly by 27%, while cobalt production increased by only 4%.
Rocky Mountain Institute (RMI): "The key to opening a new era of green hydrogen energy: China's 2030 "Renewable Hydrogen 100" development roadmap"
June 30, Rocky Mountain Institute (RMI) and China Hydrogen Energy Alliance research The institute jointly released "The Key to Opening a New Era of Green Hydrogen Energy: China's 2030 "Renewable Hydrogen 100" Development Roadmap." The report is based on the current development status of China's hydrogen energy industry and the "Mid- and Long-term Plan for Hydrogen Energy Industry Development (2021-2035)", which fully considers the changes in production capacity demand in various industries before 2030, the technology and cost of renewable hydrogen, and Different regional renewable resource endowments and other conditions have been studied and judged on the consumption demand of renewable hydrogen in various industries, as well as the production, installed capacity, key development industries and sources of renewable hydrogen in each region. Based on this, combined with the "Hydrogen "Medium- and Long-term Plan for Energy Industry Development (2021-2035)" puts forward relevant suggestions to promote the development of the renewable hydrogen industry. [47] The main points of the report are:
► China's various industries and regions have the potential to reach at least 100GW of renewable hydrogen installed capacity in 2030, and 00GW of renewable hydrogen installed capacity in 2030 is an important cornerstone to achieve the goal of carbon neutrality in 2060. is based on the development trend of renewable hydrogen industry technology and cost economy. For example, during the thirty-year period from 2030 to 2060, China's renewable hydrogen will expand at an annual installed capacity of about 7%, that is, the installed capacity of renewable hydrogen in 2030 will reach At least 100GW can meet the market demand for renewable hydrogen in 2060 and is basically in line with the development of the industry and market.
►Before 2030, the growth in China’s renewable hydrogen consumption demand mainly lies in the replacement of traditional fossil energy hydrogen production in the chemical industry, as well as the new demand created by new technological breakthroughs in the steel and transportation industries. According to estimates, by 2030, the total renewable hydrogen consumption in the chemical industry will reach 3.76 million tons, making it China's largest renewable hydrogen demand market; China's hydrogen metallurgical production capacity is approximately 43.47 million tons, accounting for approximately 10% of the country's total production capacity About 4.5% of the industry's hydrogen consumption is about 1.74 million tons, of which 940,000 tons are renewable hydrogen, accounting for about 54%, and the rest is industrial by-product hydrogen; the number of hydrogen fuel cell vehicles in China will reach 620,000. The total hydrogen consumption is 4.34 million tons per year, of which 3.01 million tons are renewable hydrogen and the rest is industrial by-product hydrogen.
► From a regional perspective, the production of renewable hydrogen in 2030 will be mainly concentrated in the northwest region with better renewable resource endowments and in North China and East China where industry demand for hydrogen is greater. Regions where the demand for transformation and upgrading of traditional industries matches the natural endowment of renewable resources will become important development bases for renewable hydrogen, with relatively large installed capacity and low-cost renewable hydrogen, such as the northwest region.In areas with good traditional industrial foundation, dense population and limited renewable resources, the cost of large-scale preparation of renewable hydrogen is high. The development of hydrogen energy will be supported by the "industrial by-product hydrogen + distributed hydrogen production + short-distance transportation" model, such as parts of the eastern seaboard. In areas where renewable resources have local advantages but are unevenly distributed, the "centralized hydrogen production + short- and medium-distance transportation" model can be used to achieve accelerated penetration of renewable hydrogen, such as northern North China.
► On the basis of improving the goals of sub-sectors and sub-regions, it is crucial to reduce the cost of the industrial chain by strengthening large-scale demonstrations of "big bases" and at the same time improve the renewable hydrogen industry planning of each locality that suits their own development conditions. recommends that based on the existing "Plan", we further study and formulate renewable hydrogen installation targets for 2030 and 2060, as well as sub-regional and sub-sector production and consumption targets. Strengthen linkage cooperation at all levels, carry out "big base" demonstration projects, and jointly develop the renewable "hydrogen economy". Guided by the national mid- and long-term hydrogen energy development plan, local hydrogen energy and renewable hydrogen industry support policies should be formulated according to local conditions. Increase policy support for the development of renewable hydrogen projects and improve the incentive mechanism for low-carbon clean hydrogen projects.
► China’s overall hydrogen energy development strategic layout needs to be staged and step-by-step, taking advantage of the complementarity of hydrogen energy from different sources, maximizing the emission reduction effect of hydrogen energy, and creating a more adequate development foundation for renewable hydrogen. should consider diversified applications in the near future, taking into account both economy and cleanliness, using fossil energy to produce hydrogen and by-product hydrogen to effectively drive the large-scale development of the hydrogen energy consumption side, cultivate the upstream and downstream hydrogen energy industry chains, and reduce the whole life cycle cost while At the same time, it will pave the way for the promotion and application of green hydrogen. In the mid-term, a supply system dominated by renewable hydrogen will be gradually built, and the transition to renewable hydrogen will be gradually realized through strengthened market-oriented means and policy measures to guide and incentivize production and application scenarios. In the long term, comprehensive breakthroughs will be made to realize the synergy of renewable hydrogen and electricity and complete the replacement of fossil energy in heavy industry and long-distance transportation.
Carbon neutrality cutting-edge science and technology
► Binghamton University: Three-layer bacterial biobattery can sustainably generate electricity for weeks
On June 22, according to Tech Xplore, a scientific research team at Binghamton University in the United States developed a biological The battery, which contains three layers of different bacterial species, absorbs sunlight and generates electricity. While the team's previous battery developed two types of bacteria interacting to produce the required power, this new iteration stacks chambers containing different bacteria in three layers. The top layer is made up of photosynthetic bacteria, which gain energy from sunlight and produce organic molecules that provide food for the bacteria below. At the bottom are electrogenic bacteria, and the bacteria in the middle produce some chemicals to improve electron transport. [48]
► Chinese Academy of Sciences: Closed-loop cobalt recovery from waste lithium-ion batteries based on deep eutectic solvent (DES)
html On June 24, according to Tech Xplore, a team from the Chinese Academy of Sciences reported a deep eutectic solvent based on ChCl:OA (DES) closed-loop efficient method to recover lithium cobalt oxide from spent lithium-ion batteries. The ultra-fast leaching process can be achieved in 10 seconds at 180°C, and nearly 100% leaching rate can be achieved in 2 hours at 90°C, meeting the design requirements for a mild and efficient reaction process. This method can reversibly adjust the solubility of cobalt ions by simply adding/evaporating deionized water, thereby avoiding the addition of precipitating agents, making the leaching solvent easy to recover, and achieving a closed-loop recovery process. [49]►Chinese Academy of Sciences: Anode-free sodium battery with high energy density and long cycle life
On June 29, according to Tech Xplore reports, a research team from the Chinese Academy of Sciences and other institutions developed an initial anode-free sodium battery with an energy Density and cycle life are higher than ordinary sodium-ion batteries. This anodeless sodium battery is manufactured by introducing a graphitic carbon coating on an aluminum current collector and a boron-containing electrolyte in the battery, and using an interface engineering approach. Each cell includes a boron-based electrolyte, graphite current collector, and layered oxide. cathode. Test results found that the sodium battery has a cycle life of 260 cycles without applying additional pressure and an energy density of over 200Wh/kg, even higher than commercial lithium iron phosphate graphite batteries.[50]
► Daegu Gyeongbuk Institute of Science and Technology: Improving the efficiency of solar cells’ light absorption capacity
html On July 1, according to Tech Xplore, a research team at Daegu Gyeongbuk Institute of Science and Technology proposed a new method to improve the efficiency of solar cells’ light absorption capacity. The team enhanced the solar cells' light absorption capabilities and photocurrent generation by implementing nanostructured electrodes on the backside of perovskite quantum dot solar cells, a next-generation solar cell material. In addition, the team systematically verified the correlation between nanostructure shapes and solar cell efficiency, as well as optimized conditions for nanopattern formation in organic materials. [51]► Hong Kong University of Science and Technology: Building the world’s most durable hydrogen fuel cell
html On July 1, according to Tech Durable and more cost effective. The new formula developed by the team reduced the proportion of platinum used in hydrogen fuel cells by 80% and also set a record in terms of battery durability. The new hybrid catalyst can manage to maintain platinum catalytic activity at 97% after 100,000 accelerated stress tests, while current catalysts typically lose more than 50% in performance after 30,000 cycles. In another test, the new fuel cells did not show any performance degradation after 200 hours of operation. The reason behind the improved performance is that the new catalyst has three different active sites for the reaction, whereas current catalysts only have a single active site. Using a formulation containing atomically dispersed platinum, iron single atoms and platinum-iron nanoparticles, the new mixture accelerated the reaction rate and achieved catalytic activity 3.7 times higher than platinum itself. Theoretically, the higher the catalytic activity, the more power it can provide. [52]► University of California, San Diego: Liquefied gas electrolyte helps manufacture temperature-resistant lithium batteries
html On July 5, according to Tech Xplore reports, a research team at the University of California, San Diego developed a new liquefied gas electrolyte (LGE) that can be used in production Lithium metal battery, allowing it to operate safely between -60°C and 55°C. The team designed an electrolyte composed of various fluorocarbon gases that, when pressure is applied, liquefy to form an electrolyte with stable chemistry, a low freezing point, and low cost. This LGE is highly compatible with lithium metal batteries, and in initial tests using lithium anodes, it achieved an average Coulombic efficiency (CE) of 99.6% over 500 cycles.[53]Weather and climate
Temperature and precipitation
Chart: Live map of national average temperature anomalies in the past 10 days
Source: Central Meteorological Observatory [54], CICC Research Department
Chart: National precipitation anomaly percentage in the past 10 days Figure
Source: Central Meteorological Observatory, CICC Research Department
Climate Disaster Forecast
Chart: National High Temperature Forecast from July 4 to July 13
Source: National Climate Center of China Meteorological Administration [55], CICC Research Institute Note: The data in the figure is the average maximum temperature forecast
Chart: National heavy rain forecast from July 4 to July 13
Source: National Climate Center of China Meteorological Administration, CICC Research Institute Note: The data in the figure is the cumulative precipitation forecast
data source
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Article source
This article is excerpted from : "Carbon" Policy China (19) released on July 7, 2022: Is the EU Carbon Border Adjustment Tax Really Coming? June 23~July 6"
Kou Yue SAC Practice Certificate Number: S0080120120022 SFC CE Ref: BRH427
Wang Hanfeng SAC practicing certificate number: S0080513080002 SFC CE Ref: AND454
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This public account is only open to CICC clients in mainland China. Any subscribers who do not meet the above conditions are kindly asked to evaluate the appropriateness of receiving subscription content before subscribing. Subscribing to this official account does not form the basis of any contract or commitment, and CICC will not regard subscribers as customers of CICC due to any mere subscription to this official account.
General statement
This public account is only a repost of some of the views of CICC’s published reports. The profit forecasts, target prices, ratings, valuations and other views contained are based on a series of assumptions and prerequisites. Subscribers can only Only by understanding all the information in relevant reports can we form a more comprehensive understanding of relevant viewpoints. For a full view, you should see the full report on the CICC Research website (http://research.cicc.com).
This information is forwarded with a delay compared to the report officially released by CICC, and may no longer be accurate or invalid due to changes in circumstances or other factors after the date of the release of the report. The opinions, assessments and forecasts contained in this material are solely those on the date of issuance of the report. These opinions, assessments and forecasts are subject to change at any time without notice. The price or value movement of securities or financial instruments may be affected by various factors, and past performance should not be used as a predictor or guarantee of future performance. At different times, CICC may issue research reports that are inconsistent with the opinions, assessments and forecasts contained in this material. CICC's sales staff, traders and other professionals may make oral or written market comments and/or trading opinions that are inconsistent with the opinions contained in this material based on different assumptions and standards and using different analysis methods.
Where permitted by law, CICC may be establishing or seeking to establish business relationships or service relationships with the companies mentioned in this material. Therefore, subscribers should consider that CICC and/or its related personnel may have potential conflicts of interest that may affect the objectivity of the views expressed in this material. For disclosure information related to this material, please visit http://research.cicc.com/disclosure_cn. You can also refer to the recently released specific research reports on relevant companies.
This subscription account is an official subscription account established and maintained by the Research Department of CICC. The copyright of all materials in this subscription account belongs to CICC. No organization or individual may forward, reproduce, reproduce, copy, publish, publish, modify, copy or quote the content in this subscription account in any form without written permission. .
This public account only forwards some of the views of research reports published by CICC. If subscribers use the information contained in this public account, they may misunderstand the key assumptions and information in the information due to lack of understanding of the complete report or lack of relevant interpretation. Contents such as ratings and target prices create ambiguities in understanding. Subscribers must seek guidance and interpretation from professional investment advisors if they use this information.The information and opinions contained in this public account do not constitute a bid or solicitation for the purchase or sale of the securities or financial instruments mentioned, nor do analysis and judgments such as ratings, target prices, valuations, profit forecasts, etc. constitute a judgment on the specific price or price of specific securities or financial instruments. Investment advice based on specific time points and specific market performance. Such information and opinions shall not constitute targeted, specific investment operational opinions for anyone at any time. Subscribers should evaluate the information and opinions in this public account, make investment decisions independently based on their own circumstances and Invest at your own risk.
CICC does not make any express or implied guarantee as to the accuracy, reliability, timeliness and completeness of the information contained in this official account. CICC and/or its affiliates do not assume any form of responsibility for any consequences caused by relying on or using the information contained in this official account.
This public account is only open to CICC clients in mainland China. Any subscribers who do not meet the above conditions are kindly asked to evaluate the appropriateness of receiving subscription content before subscribing. Subscribing to this official account does not form the basis of any contract or commitment, and CICC will not regard subscribers as customers of CICC due to any mere subscription to this official account.
General statement
This public account is only a repost of some of the views of CICC’s published reports. The profit forecasts, target prices, ratings, valuations and other views contained are based on a series of assumptions and prerequisites. Subscribers can only Only by understanding all the information in relevant reports can we form a more comprehensive understanding of relevant viewpoints. For a full view, you should see the full report on the CICC Research website (http://research.cicc.com).
This information is forwarded with a delay compared to the report officially released by CICC, and may no longer be accurate or invalid due to changes in circumstances or other factors after the date of the release of the report. The opinions, assessments and forecasts contained in this material are solely those on the date of issuance of the report. These opinions, assessments and forecasts are subject to change at any time without notice. The price or value movement of securities or financial instruments may be affected by various factors, and past performance should not be used as a predictor or guarantee of future performance. At different times, CICC may issue research reports that are inconsistent with the opinions, assessments and forecasts contained in this material. CICC's sales staff, traders and other professionals may make oral or written market comments and/or trading opinions that are inconsistent with the opinions contained in this material based on different assumptions and standards and using different analysis methods.
Where permitted by law, CICC may be establishing or seeking to establish business relationships or service relationships with the companies mentioned in this material. Therefore, subscribers should consider that CICC and/or its related personnel may have potential conflicts of interest that may affect the objectivity of the views expressed in this material. For disclosure information related to this material, please visit http://research.cicc.com/disclosure_cn. You can also refer to the recently released specific research reports on relevant companies.
This subscription account is an official subscription account established and maintained by the Research Department of CICC. The copyright of all materials in this subscription account belongs to CICC. No organization or individual may forward, reproduce, reproduce, copy, publish, publish, modify, copy or quote the content in this subscription account in any form without written permission. .
