Focus on Arts and Ecology

The big environmental stories in the Chinese media (16 - 22 April) 

The 2021 Green Bond Catalogue, finally released on Wednesday, excludes the phrase “clean coal use”.

The catalogue is an update of the 2015 version, and will take effect on 1 July. 
 
According to a Q&A prepared by the People’s Bank of China, the exclusion of “clean coal” is for the catalogue to “better align with international standards”.

Compared with last year’s consultation drafts, the new document takes out shale oil and tar sand exploitation, while adding “clean hydrogen production”. It also provides far more detailed explanations of each category and makes it easier for issuers to vet bond products.
 
The Q&A says the new catalogue has adopted the “do no significant harm” (DNSH) principle, to reflect more strict decarbonisation requirements in China. The principle is designed to ensure actions to achieve one environmental goal do not hit progress towards others. Though the application of the principle is implicit, explicit DNSH language is used on items including large scale hydro projects and utilisation of marine energy. 
 
Coal hasn’t disappeared entirely from the catalogue. It allows for green bonds to be issued for industrial desulfurization, denitrification and dust removal for coal-fired facilities. Natural gas, another fossil fuel, still figures prominently, including the construction of natural gas pipelines and storages, and LNG terminals.
 
The Q&A’s closing paragraph addresses the transition question of the fossil fuel industry. It says the clean production and use of fossil fuels including coal is still important for the “high-quality economic development” of the country at the current phase, and that therefore the central bank is studying standards for transition finance to ensure carbon peaking and neutrality can be reached smoothly. 
 
On the same day, the European Commission published the first batch of its long-awaited Taxonomy defining what investments can be considered sustainable. Natural gas and nuclear power, both included in China's new Green Bond Catalogue, are not included, though that may be subject to change.
 
Read China Dialogue’s earlier coverage on China’s green bond catalogue revisions.

(Sources: China Dialogue)