Measuring the Dragon: Carbon Reporting in China

With a national carbon trading scheme in China now on the horizon, more and more Chinese companies are reporting their carbon emissions

Measuring and reporting Chinese companies’ carbon emissions is a vital step in reducing their overall environmental impact

The news that the first of China’s seven pilot emissions schemes will begin next month is the latest development of more stringent carbon reporting and emissions management from the world’s largest greenhouse gas emitter.

Since the seven provincial schemes were announced in November 2011, thousands of China’s largest companies have been required to calculate and report their carbon emissions in order to allocate carbon allowances.

This includes 635 in Shenzhen, 200 in Shanghai, 600 in Beijing and 827 in Guangdong.

Meanwhile others are being pressurised to do so by their Western partners.

Loftex China Limited, for example, is one of the country’s largest textile manufacturers and supplies Walmart with a range of towels and blankets.

Thanks to Walmart’s requests to green its supply chain, Loftex has implemented a number of energy efficiency improvements such as wastewater heat recovery and heat-retaining coating, saving several million kWh of energy each year.

Chinese Dream Project

Although the majority of China’s companies are still not legally required to participate in carbon reporting, official policy is to introduce a nationwide emissions trading scheme in the coming years.

This means that an increasing number of companies are likely to get involved voluntarily in order to better prepare themselves for government regulation, not to mention saving money from improved operating efficiency.

Government subsidies may also play a role.

In August 2012, for example, 200 companies in Hong Kong received subsidies up to HK$30,000 to conduct carbon audits under a government scheme to cut business emissions.  

These points were raised at a recent event hosted by the Carbon Disclosure Project (CDP) in Beijing, entitled “The Business Case for Carbon Management and Disclosure in China”.

Dubbed the ‘Chinese Dream Project’ by the CDP’s Executive Chairman, assisting China’s transition to a low carbon economy is indeed a dream for everyone interested in environmental protection as well as a sustainable Chinese economy.

Ensuring companies appreciate the business sense of reporting carbon emissions is a critical first step in achieving this dream.

It will also provide greater insight into exactly who is responsible for China’s vast, and still rising, emissions. 

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