China’s Move Away from Voluntary Green Certificates: Implications for Corporate Renewable Procurement

The briefing analyzes a draft policy from China's National Energy Administration (NEA) that introduces a mandatory Renewable Portfolio Standard (RPS) and a corresponding REC system. While the policy aims to reduce curtailment and create a market-based mechanism for renewable energy procurement, the document identifies significant uncertainties regarding whether RECs will be bundled with electricity, the extent of interprovincial trading for corporate users, and the pricing of replacement certificates used for compliance shortfalls.

• The draft policy introduces a mandatory Renewable Portfolio Standard (RPS) across all provinces and a new REC system to track renewable energy generation used to meet these targets. The RPS is designed to reduce the curtailment of existing renewable energy facilities by basing formulas on existing and planned capacity, including interprovincial transmission.
• Regulated entities under the RPS include provincial grid companies, distribution and retail electricity companies, industrial users with captive power plants, and corporate/industrial users engaged in bilateral electricity trading. Non-compliance can lead to penalties such as reduced electricity procurement limits or loss of market qualification, though buyers can use replacement certificates issued by provincial grid companies to cover shortfalls.
• The proposed REC system differs from the existing Green Electricity Certificate (GEC) system because RECs do not interfere with a project owner's ability to receive government subsidy payments. In contrast, selling GECs replaces the government subsidy payment.
• Three primary uncertainties remain in the draft policy: whether RECs are bundled or unbundled from electricity, whether the interprovincial market will be open to corporate and industrial (C&I) users or limited to grid companies, and the specific pricing mechanisms for replacement certificates set by provincial grid companies.

APA

RMI (2018). China’s Move Away from Voluntary Green Certificates: Implications for Corporate Renewable Procurement. https://rmi.org/resources/chinas-move-away-from-voluntary-green-certificates-implications-for-corporate-renewable-procurement/

Chicago

RMI. China’s Move Away from Voluntary Green Certificates: Implications for Corporate Renewable Procurement. 2018. https://rmi.org/resources/chinas-move-away-from-voluntary-green-certificates-implications-for-corporate-renewable-procurement/.

Wikipedia

{{cite report |author=RMI |title=China’s Move Away from Voluntary Green Certificates: Implications for Corporate Renewable Procurement |date=7 May 2018 |url=https://rmi.org/resources/chinas-move-away-from-voluntary-green-certificates-implications-for-corporate-renewable-procurement/ |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{rmi2018chinas, author = {{RMI}}, title = {{China’s Move Away from Voluntary Green Certificates: Implications for Corporate Renewable Procurement}}, institution = {RMI}, year = {2018}, month = may, url = {https://rmi.org/resources/chinas-move-away-from-voluntary-green-certificates-implications-for-corporate-renewable-procurement/}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }