Scaling a Credible Transition Finance Market in China

This report, produced by the Climate Bonds Initiative and Peking University, examines the role of transition finance in decarbonising China's power sector. It emphasizes the necessity of credible, science-based transition plans to attract capital and avoid greenwashing, while analyzing the use of sustainability-linked bonds (SLBs) and use-of-proceeds (UoP) instruments. The document provides a framework for electrical utilities to develop transition roadmaps and includes case studies of Vattenfall, Enel, and China Huaneng Group to illustrate varying levels of alignment with global standards.

• China's power industry is targeting a transition where coal power installed capacity (excluding backup units) peaks at 1.18bn kW in 2025, with power generation and carbon emissions also peaking in 2025 and plateauing around 2030.
• In China, the most common KPI for electrical utility SLBs is the increase of renewable energy capacity, used in 79% of the KPIs chosen by domestic issuers.
• Credible transition plans are essential to mitigate greenwashing risks and carbon lock-in; they should include time-bound, trackable action plans rooted in climate science and cover Scope 1, 2, and 3 GHG emissions.
• Case studies reveal a gap in alignment with the Climate Bonds SLB database methodology: while Vattenfall and Enel have detailed targets, China Huaneng Group's SLBs are recorded as 'Not Aligned' because the issuer had not stated GHG targets as of mid-2024.

APA

Xu, X., MacGeocH, M., Xie, W., Zhou, X., & Chen, D. (2024). Scaling a Credible Transition Finance Market in China. Climate Bonds Initiative. https://www.climatebonds.net/files/documents/publications/cbi_chinaelectrical_24_02a.pdf

Chicago

Xu, Xiaoyun, Matthew MacGeocH, Wenhong Xie, Xiaozhu Zhou, and Dan Chen. Scaling a Credible Transition Finance Market in China. Climate Bonds Initiative, 2024. https://www.climatebonds.net/files/documents/publications/cbi_chinaelectrical_24_02a.pdf.

Wikipedia

{{cite report |last1=Xu |first1=Xiaoyun |last2=MacGeocH |first2=Matthew |last3=Xie |first3=Wenhong |last4=Zhou |first4=Xiaozhu |last5=Chen |first5=Dan |title=Scaling a Credible Transition Finance Market in China |publisher=Climate Bonds Initiative |date=July 2024 |url=https://www.climatebonds.net/files/documents/publications/cbi_chinaelectrical_24_02a.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{xu2024scaling, author = {Xu, Xiaoyun and MacGeocH, Matthew and Xie, Wenhong and Zhou, Xiaozhu and Chen, Dan}, title = {{Scaling a Credible Transition Finance Market in China}}, institution = {Climate Bonds Initiative}, year = {2024}, month = jul, url = {https://www.climatebonds.net/files/documents/publications/cbi_chinaelectrical_24_02a.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }