Energy saving and environmental protection loans exceed 5 trillion. How to define green credit remains to be solved

By the end of June 2016, the green credit balance of 21 major banking institutions had reached 7.26 trillion yuan, accounting for 9.0% of all loans, including 1.69 trillion yuan for strategic emerging industries such as energy-saving and environmental protection, new energy and new energy vehicles, and 5.57 trillion yuan for energy-saving and environmental protection projects and services.

It takes nearly 300 years for 20 million people to walk to and from work in Beijing to save 187 million tons of standard coal energy. With the leverage effect of financial institutions, this goal can be achieved in one year.

On September 2, the CBRC held a "green credit in the banking sector to help economic restructuring and industrial restructuring and upgrading" conference, the CBRC Policy Research Bureau inspector Ye Yanfei made the above statement.

Ye Yanfei pointed out that by the end of June 2016, the green credit balance of 21 major banking institutions had reached 7.26 trillion yuan, accounting for 9.0% of all loans, including 1.69 trillion yuan for strategic emerging industries such as energy conservation and environmental protection, new energy and new energy vehicles, and 5.57 trillion yuan for energy conservation and environmental protection projects and services.

By the end of June, the non-performing loan balance of 21 major banking institutions for energy-saving and environmental protection projects and services was 22.625 billion yuan, with a non-performing rate of 0.41%, which was lower than the non-performing loan rate of 1.35 percentage points over the same period.

"In fact, we need people and money to build an eco-civilization, a beautiful China, and energy conservation and emission reduction. Finance is a very important support point, and also a very important starting point and focus." Ye Yanfei said.

The CBRC said that the environmental benefits of energy saving and environmental protection projects are remarkable. How can this be quantified? Yeh Yanfei pointed out that according to the proportion of such loans, it is estimated that 187 million tons of standard coal can be saved annually. The algorithm is that the ratio of enterprises'loans from banks, multiplied by the energy saving of enterprises' conversion, is regarded as the emission reduction effect of bank loans.

Specifically, for example, an enterprise invests in a waste heat power generation project, which can convert the energy-saving effect of heat power generation abandoned by old energy sources, such as saving 1 million kilowatt-hours a day, and then according to the normal local coal power generation situation, how many tons of standard coal can be saved.

If the total investment of the project is 100 million RMB, 70 million of which are loans from banks and 30 million of which are invested by enterprises themselves, it would be equivalent to saving energy by, say, 1 million tons of standard coal, 70% of which is due to the effect of bank loans. "This project saves energy and reduces emissions for one year, multiplying the proportion of loans to total investment, and we think it should be attributed to the effect of bank loans on emissions reduction." Ye Yanfei said.

He pointed out that if each item were to do so, 187 million tons of standard coal (7,000 kcal/kg of coal) would be saved annually and 435 million tons of carbon dioxide equivalent (tons of carbon dioxide multiplied by its greenhouse effect index) would be reduced. "What is the equivalent of reducing emissions in a year? It takes nearly 300 years for Beijing to stop 70,000 taxis and 20,000 people to walk to and from work." Ye Yanfei said.　　

According to Ye Yanfei, 5 trillion and 570 billion of energy saving and environmental protection projects and service loans are divided into ten categories. Among them, green transportation projects accounted for the largest, with a loan balance of 26542.27 billion yuan, accounting for 47.6% of the energy-saving and environmental protection projects in the same period. Green transportation mainly includes railway construction, urban rail construction projects such as subway, urban electric vehicle projects, as well as highway energy-saving renovation projects (such as energy-saving lights) and so on.

Some people have calculated that if walking consumes about one-sixth of the energy consumed by walking, cycling consumes about one-half of the energy consumed by walking, traveling to work by rail transit consumes about one-half of the energy consumed by walking, and driving a car to work consumes 20 times as much energy as walking. Therefore, the energy consumption of rail transit is only 1/10 of the car. "So the most energy-efficient way of life is to ride a bike to and from work, or to go to work on track."

In addition to green transport projects, the second largest category of energy-saving and environmental protection projects and service loans is renewable resources and clean energy projects, with a balance of 146.86 billion yuan, or 26.4 percent, at the end of June 2016. Renewable resources include hydropower, wind power, coal to gas, solar power and so on. According to Ye Yanfei, nuclear energy has not been included in clean energy projects. This is because some people believe that although nuclear power itself is not polluting, but will have a very bad environmental effect.

In addition to the first two categories, energy-saving and environmental protection projects and service loans also include industrial energy-saving, water-saving and environmental protection projects, waste treatment and pollution prevention projects, natural protection, ecological repair and disaster prevention and control projects, resource recycling projects, rural and urban water projects, energy-saving and environmental protection services loans, green agriculture projects. These loans remained relatively small, accounting for 7.3%, 5.2%, 3.9%, 2.6%, 2.4%, 1.9%, 1.1% and 0.6% respectively.

How to define green credit is a difficult problem, will there be any bank statistical fraud, resulting in credit "green" and "bleaching green" situation? Ye Yanfei pointed out that in 2013, the CBRC issued the "Green Credit Statistics System", in cooperation with a number of ministries and commissions, strictly defined the various standards of green credit.

"To what extent? For example, dozens of cases of eco-agriculture that have been examined by WWF experts can be compared to see if the bank's loan is actually a green loan. For example, what is green building? There are standards in the Ministry of construction, and how much the building has to get the light rate. If we find false data, we can supervise the banks to correct them. Ye Yanfei said.