Major Chinese lenders back clean energy programs to curb pollution
Banks in China are playing their part to curb pollution and global warming by investing 7.51 trillion yuan ($1.11 trillion) in nationwide green projects.
Carbon dioxide emissions are expected to be reduced by 427 million metric tons annually as a result of these clean energy programs, a report has revealed, while 602 million tons of water will be conserved every year.
“Green finance is ideal as banks can shoulder the social responsibility and realize commercial profit,” said Pan Guangwei, vice-president of the China Banking Association when releasing the 2016 Corporate Social Responsibility Report.
Investments in energy conservation and environmental protection projects reached 5.81 trillion yuan by the end of 2016, compared with 1.46 trillion yuan in 2011.
Up to 1.7 trillion yuan was invested in emerging industries, including e-cars, by 21 major banks, the report disclosed. This brought total loans for green programs to 7.51 trillion yuan.
But there was a reluctance to finance projects involved in sectors such as printing, dyeing, chemical engineering and traditional fossil fuel power generation.
Still, high-tech programs were well financed, including new waste-to-energy plants, which are low on emissions.
The Anhui branch of the Export-Import Bank of China provided 1 billion yuan in loans to Kaidi Ecological Environment Technology Co Ltd to construct six waste-to-energy power stations.
They will generate electricity by burning general waste, including rice husks and million
tons of carbon dioxide emissions are expected to be reduced annually
straw. “Environmental protection projects require substantial capital and it takes a long time to get the money back,” said Feng Chunping, general manager of the strategic planning department of the Export- Import Bank of China.
To solve this problem, the lender cooperated with overseas financial institutions to fund more than 100 green projects, which involved wind, water and solar energy power generation.
Last year, investment from banks in companies pursuing renewable and clean energy projects reached 1.47 trillion yuan from Chinese banks, according to the report.
“But industries involved in high energy consumption sectors such as steel, faced an 8.89 percent drop in bank funding,” the report stated.
Major investment went to projects to ease water shortages and repair ecosystems.
As urbanization took off in the 1990s, the wetlands area of the southern Jiaojiang district of Taizhou in Zhejiang province shrank by 5.5 million square meters.
In 2014, China Zheshang Bank agreed loans worth 700 million yuan with the local government to increase the width of the river to a maximum 100 meters and construct two lakes.
This will prevent flooding and also boost the water supply by 7.6 million squaremeters, according to the official website of the Zhejiang water resources department.