Following the arrangements made by the State Council executive meetings, the People’s Bank of China (PBC) announced the launch of a carbon emission reduction facility (CERF) in November 2021. Since then, the PBC Shanghai Head Office has proactively encouraged local financial institutions to apply CERF in loan issuance, supporting the development of clean energy, energy conservation, environmental protection, carbon reduction technology and other key areas, thus helping achieve the carbon peaking and carbon neutrality goals.
According to statistics, as of end-December 2021, financial institutions in Shanghai had granted RMB3.75 billion of CERF loans, of which RMB3.43 billion was channeled to clean energy and RMB320 million to energy conservation and environmental protection, with an estimated carbon emission cut by 752,000 tonnes per annum. The loans, with a weighted average maturity of 13.7 years and a weighted average interest rate of 4.09 percent, were extended to over 50 enterprises. The financial institutions have applied to the PBC in two batches for reimbursement of the CERF funds.
Commercial banks have improved their financial services by actively applying the CERF. In pursuit of sustainable development in business, commercial banks in Shanghai have proactively integrated themselves into and efficiently served the green and low-carbon transition of the regional economy. With improved quality of comprehensive financial services, they have enhanced support for carbon emission reduction projects.
The CERF has also secured positive outcomes in promoting the transition and upgrading of traditional industries, development of photovoltaic power generation for rural households, environmental pollution control, offshore wind power generation, and improvement of people’s livelihood in Shanghai.
