Transcript The Case of China CDM Fund - USAID Adapt Asia

The Case of China CDM Fund
-- focusing on the type of fund,
governing body and capital
XIE Fei
Director, Revenue Management Department
China Clean Development Mechanism Fund
September 7, 2012
Bangkok, Thailand
Rationale of Establishing
China CDM Fund
Unique Points of Chinese CDM Policy:
The Measures for Operation and Management of CDM
Projects in China stipulates that the revenue generated
by Chinese CDM project is shared by the government
and project owner. Because the resource of GHG
emission reduction is owned by the government.
The government sharing, called as national revenue, is
put in China CDM Fund, specifically supporting climate
change activities.
China CDM Fund at a glance


Establishment: November 2007.
Objective: To support China’s efforts in tackling climate
change and promote sustainable development.

Governing body:
Board of China CDM Fund; and
China CDM Fund Management Center

Legal status: Public institution that integrates government
and market functions.

Beneficiaries: Chinese institutions working on climate
change.
China CDM Fund Is A Revolving Fund


Major sources of the fund:

national revenue from Chinese CDM projects;

interest earned from its operation.
Current capital size: RMB 10 billion
(about USD1.58 billion)
Its capital size will become larger
and larger gradually, depending
upon CDM development.
Governing Body

The Board of China CDM Fund consists of most climate
change-related ministries in China:

Chair: National Development and Reform Commission ;
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Vice Chair: Ministry of Finance;

Members: Ministry of Foreign Affairs
Ministry of Science and Technology
Ministry of Environmental Protection
Ministry of Agriculture
China Meteorological Administration
Roles of The Board

The Board of China CDM Fund is responsible for
reviewing the following issues:
Management regulations;

Strategic planning of the Fund, including annual budget
plan;

Application for grants and investments;

Annual budget and accounting; and

Other major undertakings.
Roles of China CDM Fund
Management Center
China CDM Fund Management Centre performs the
following duties:
 Draw up fund regulations on management and operation;
 Raise funds;
 Manage the funds and carry out investments and wealth
management activities;
 Formulate and implement annual budget and accounting of
the Fund;
 Supervise and manage the operation of projects supported
by the Fund;
 Report major business activities of the Fund to the Board;
 Other activities that serve the purpose of the Fund.
Main Functions
China CDM Fund has the following two main functions to
support addressing climate change and low carbon
development in China.
Policy research
China CDM Fund

International cooperation
Software
Construction
Grant
Capacity building
Public awareness
Equity investment
Hardware
Construction
Support RE and EE
through
Concessional loans
Portfolio guarantee
All lending/investment projects are required to make a carbon budget.
Major Activities & Business Operations
--- software construction

Over 280 million RMB is granted to support over 130
projects on tackling climate change, including:

Updating China's National Climate Change Program;

Policy/strategy studies on climate change;

Preparation of provincial climate change planning;

Preparation of provincial GHG emission inventory；

Formulation of low carbon development programs; and

Supporting carbon trading schemes in six pilot
provinces/cities in China.
Major Activities & Business Operations
--- software construction (cont.)
Preparation of climate change planning for 31 provinces/cities.
Major Activities & Business Operations
--- software construction (cont.)
Formulation of Low carbon development programs &
carbon trading schemes in pilots in China.
Major Activities & Business Operations
--- hardware construction


Principle: China CDM Fund plays a role as a seed
capital that exploits market mechanism and mobilizes
more social capital to support addressing climate
change and low carbon development in China.
Requirement: Renewable, clean energy; energy
efficiency. Carbon budget and MRV (monitoring,
reporting & verifying).
By the end of June 2011,
 Investment: USD 360 million
Financing projects: 45
 Location: 13 provinces (cities)
 Leveraging social capital: over
USD 2.8 billion
Major Activities & Business Operations
--- hardware construction (cont.)
Projects financed by China CDM Fund includes:
 Investment in Shanghai Environment and Energy
Exchange, who supports Shanghai to be the first
city/province implementing carbon trading scheme;
 Renewable energy development: biomass, hydropower,
solar power;
 Energy efficiency enhancement: heating recovery,
central heating system, natural gas replacing coal,
energy saving products like inverter air conditioner
compressor, LED lighting, electric bus.
Major Activities & Business Operations
--- hardware construction (cont.)
Distribution of projects supported by China CDM Fund.
Major Activities & Business Operations
--- Other activities

Collaborate with World Bank, IFC, ADB, Deutsche Bank
and other international and domestic banks, to explore
innovative climate change financing mechanisms;

Be Involved in carbon market and climate financing
policy research works;

Provide consulting services to domestic CDM project
entities.
For a low carbon future！
Thank you！
XIE Fei
Director, Revenue Management Department
[email protected]
Tel: +86-10-88659260
Web: www.cdmfund.org