Addressingbarrierstolarge-scalecorporaterenewableenergyprocurementinChinaMarch2022AcknowledgementsTheCarbonTrustwouldliketothankeveryonethathascontributedtheirtime,insightsandexpertiseduringthepreparationandcompletionofthisreport.SpecialthanksgotoMrConorGaskandMsMaChongxi,whoseinputwasinvaluableincompletingthisprojectandreport.WewouldalsoliketoexpressoursinceregratitudetotheUKForeign,Commonwealth&DevelopmentOffice(FCDO)foritsfinancialsupport.Fortheavoidanceofdoubt,theviewsexpressedinthisreportdonotnecessarilyreflecttheviewsoftheUKFCDOortheindividualsandtheirorganisationsmentioned.Contents1.Executivesummary........................................................................................................42.Introduction.....................................................................................................................5Projectcontext...........................................................................................................5CorporateinterestinREprocurement.....................................................................5Reportstructure.........................................................................................................63.CorporateREprocurementlandscapeinChina...........................................................6AvailableoptionsforcorporateREprocurement....................................................6Policiesforrenewableenergydevelopment...........................................................10Estimationofdemandsize.......................................................................................14BarrierstocorporateREprocurement....................................................................174.CorporateREprocurementlandscapeintheUK........................................................21CurrentavailableoptionsforcorporateREprocurement......................................21Keyenablementpolicies..........................................................................................26Keypolicyimpacts....................................................................................................295.RecommendationsforsupportingcorporateREprocurementinChina..................306.Listofreferences..........................................................................................................3441.ExecutivesummaryToachieveitsclimatecommitmentsfor2030and2060,Chinawillcontinuetoincreaseitsdeploymentofrenewableenergy.Therapidlygrowinginterestanddemandforrenewableelectricityprocurementfromcorporateswillbeasignificantdriverfortheinvestmentanddeploymentofrenewableenergy.WiththesupportoftheUKForeign,Commonwealth&DevelopmentOffice(FCDO),thisreportaimstoidentifythebarriersandproviderecommendationstoscale-uprenewableenergyprocurementinChina.WiththesupportofaseriesofpoliciesincludingFeed-in-Tariffs(FiTs),renewableenergydevelopmentinChinahassubstantiallyincreasedinpastdecades,whilethecostshavereducedsignificantly,enteringasubsidy-freeera.SincethelaunchofthegreenelectricitytradepilotprograminSeptember2021,directgreenelectricitytransactionshaveaccelerated.Followingthis,authoritieshavereleasedseveralsupportingpolicies,suchasthetrialtransactionrulesinthesouthernregionwhichclarifythedetailedrules,andtheImplementationPlanforPromotingGreenConsumptionwhichproposestofurthermobilisedemandofgreenelectricityconsumption.Currently,China’smainrenewableenergyprocurementoptionsaredirectPowerPurchaseAgreements(PPAs)andunbundledEnergyAttributeCertificates(EACs).Keybarriersincludethelackofclearmarketrulesinsomeregions,limitedaccessibilityespeciallyforinter-provincialprocurementandtheriskofdoublecountingrenewableattributesindifferentmarketsystems.TheUKexperienceprovidessomehigh-levelinsightsonrenewableenergydevelopment,suchastheimportanceofdrivingdownrenewableenergycoststobemorecompetitivethroughR&Dsupportandmarket-pullpolicies.TopromoteandacceleraterenewableenergyprocurementinChina,actionsneedtobetakentoovercomethecurrentbarriersandunlockthepotentialforrenewableelectricityprocurement.Belowisaseriesofinitialrecommendationsonhowtoscaleupgreenelectricityprocurement:•DevelopandimprovethedetailedtransactionrulesfordirectPPAsofgreenelectricitytoprovidegreaterclarityformarketplayers,especiallyretailersandbuyers.•Acceleratethetransitionfrompilotphasetonormaloperationandorganisetransactionsonaregularbasis.•Improvemarketaccessibilityandpolicytransparencytomakeiteasierforcorporatestoprocurerenewableelectricity,especiallyinternationalcompanies.•Developthemarketmechanismsforinter-provincialtransactionstoincreasethescaleofinter-provincialPPAsforgreenelectricity.•Encouragelong-termPPAs(e.g.,5-10years)forgreenelectricity,includingexploringthecurrentwillingnessofthegeneratorsandcustomerstosignlongercontracts,analysingcurrentbarriers,andpromotingpilotprojects.•AvoiddoublecountingrisksbetweendirectPPAs,GECs,RPSandCCERbystrengtheningthecoordinationbetweenauthoritiesandclarifyingtherulesofdifferentsystems.•Furthermobilisecorporates’demandforgreenelectricitybylinkingthiswiththe‘dualcontrol’policyofenergyconsumptionaswellasthecarbontradingmarket.•Inthemediumandlong-term,explorethefeasibilityofvirtualPPAsandconductpilotprojectswiththedevelopmentofaspotmarket.•PromotetechnologyinnovationinrenewableenergyandlowcarbonenergysystemstofurtherreducetheLCOEofrenewableenergy,makingitmorecompetitivethantraditionalthermalpower.52.IntroductionProjectcontextSincetheUKandChinasignedtheCleanEnergyPartnershipin2015,thetwoeconomieshavedeepenedtheircooperationinresearchandindustrytosupporteffortstotackleclimatechangeandprovidelong-termenergysecurity,workingtogethertotransitiontoalowcarbonenergysystem1.IntheUK-ChinaCleanEnergyPartnershipWorkPlan2021/2022,bothcountriesagreedtostrengthencooperationinareasincludingcleanenergytechnologies,transitionpathways,powersystemreformandinternationalgovernanceandcooperation.TheUKandChinahavereachedaconsensusthatcooperationontransitiontoacarbon-neutralenergysystemisthetoppriorityforbothcountries.Asthefirstglobaleconomytoenshrineitsnetzerocommitmentinlaw,theUKhasprioritisedenergytransitioninitsindustrialstrategy.ToachieveChina’scommitmentsofpeakingcarbonemissionsbefore2030andcarbonneutralityby2060,thedecarbonisationoftheenergysystemhasbeenidentifiedasoneofthekeyactions.Consideringthepowersector’ssignificantcontributiontoChina’stotalcarbonemissions,thelarge-scaledeploymentofrenewableenergyinChinaiscrucialtoachievingthecountry’sclimatecommitments.Accordingtothehigh-levelpolicyframeworkforachievingcarbonpeakingandcarbonneutrality2,theshareofnon-fossilfuelsintotalprimaryenergyconsumptionistargetedtoreach25%by2030and80%by2060,withwindandsolargenerationcapacitiesexceeding1,200GWby2030.Additionally,theChinesegovernmentplanstoestablishaunifiednationalpowermarketby2030,withrenewableenergyfullyparticipatinginthemarketonalevelplayingfield.Corporateprocurementofrenewableenergycanhelpreachthesetargets.CorporateinterestinREprocurementCorporateinterestinprocuringrenewableenergyhasgrownsubstantiallyoverthepastdecade,withincreasedpurchasesbecomingasignificantdriverofgrowthinthedeploymentofrenewableenergy3.Manymulti-nationalcorporationsheadquarteredinEurope,AsiaandNorthAmericahaveset100%renewableenergyconsumptiontargets,whileothershaveestablishedsmaller,butsubstantialgoals.Globalcompaniesarepurchasingrenewableenergyforavarietyofreasons:tomeetinternalclimatetargets,accessmorecompetitiveelectricityprices,anddemonstrateclimateleadership4.Inthisrespect,Chinahasbecomeamajorfocusarea,ascompaniesseektoincreasetheamountofrenewableenergysourcedfortheirownoperationsandtheirChina-basedsupplychains.GiventhatChinaistheworld’s1UKGovernment(2015a).UKandChinasigntheCleanEnergyPartnership2ChinaGovernment(2021a).中共中央国务院关于完整准确全面贯彻新发展理念做好碳达峰碳中和工作的意见_中央有关文件_中国政府网(www.gov.cn)3CRS(2019).AcceleratingCorporateRenewableEnergyEngagementinChina4Bird,L.etal.(2017).PoliciesforEnablingCorporateSourcingofRenewableEnergyInternationally:A21stCenturyPowerPartnershipReport,NationalRenewableEnergyLaboratory,Golden,CO6largestmanufacturer—accountingfor28.7%ofglobalmanufacturingoutputin20195—thereisasignificantopportunityforlarge-scaleprocurementofrenewableenergy.WiththerecentannouncementofChina’spledgetopeakemissionsbefore2030andachievecarbonneutralityby2060,thereisalsoadditionalpressuredomestically.Whiletherearenewandexistingmechanismswhichhaveenabledbothdomesticandoverseascompaniestoaccessrenewableenergy,thevoluntarymarketisstillnascent,andfurtherdevelopmentisrequiredtosignificantlyscaleupcorporateprocurement.ReportstructureWithsupportfromtheUKForeignCommonwealth&DevelopmentOffice(FCDO),thisprojectaimstoaddressthebarrierstolarge-scalerenewableenergy(RE)procurementinChinabyidentifyingthekeychallenges,reviewingUKexperiences,andprovidinginitialpolicyrecommendations.Thisreportsummarisesthekeyfindingsofthestudyandisstructuredasfollow:•Section3givesanoverviewofChina’scorporateREprocurementlandscape.Itsummarisesthecurrentlyavailableoptionsforcorporateprocurement,thepoliciesthathavebeenimplementedtostimulatetherenewableenergymarket,thebarrierstouptake,andestimatesthefuturedemandsize.•Section4assessestheUK’sexperience,lookingatcurrentlyavailableoptions,keyenablementpolicies,policyimpactsaswellassuccessesandchallenges.•Section5offersasetofshort-termandlong-termpolicyrecommendationstosupportthedevelopmentofcorporateREprocurementinChina.ThisisbasedonthebarriersidentifiedandlessonslearntfromtheUK.3.CorporateREprocurementlandscapeinChinaAvailableoptionsforcorporateREprocurementForcorporatesinChina,majorREprocurementoptionsincludedirectPowerPurchaseAgreements(PPAs),purchasingunbundledEnergyAttributeCertificates(EACs)domesticallyorinternationally,directinvestment,onsitedistributedgeneration,anddistributedmarkettransactions.Corporatescancreatetheirownportfolioofgreenelectricitywithacombinationoftheseprocurementmechanisms.Furtherdetailsofthefiveoptionsareprovidedinthetablebelow.5Statista(2021).ChinaistheWorld’ManufacturingSuperpower7Table1AvailableREprocurementoptionsforcorporatesinChinaREconsumptionoptionsDescriptionCurrentsituation2022RelevantcasesPowerPurchaseAgreement(PPA)Electricityuserscandirectlypurchasegreenelectricityfromqualifiedpowergeneratorsorretailers.ProvincialmarketsarethemajormarketplaceforPPAs.25provincesandregionshaveallowedintra-provincialPPAsforrenewableenergy6.InSeptember2021,Chinaofficiallylaunchedthegreenpowertradepilotprogram.Onthefirstday,inter-provincialgreenelectricitytransactionstotalled7,935GWh.InFebruary2022,asetofgreenelectricitytransactionruleswerereleasedonatrialbasisbythepowerexchangecentresoffivesouthernprovinces,namelyGuangdong,Guangxi,Yunnan,GuizhouandHainan.Itcoversbothintra-andinter-provincialPPAs.IntheGreenPowerTradingPilotinSeptember2021,TencentsignedPPAsforwindandsolarenergyinthesoutherntrademarketorganisedbyChinaSouthernPowerGrid.Thegreenelectricitycomesfromasubsidy-freewindpowerprojectinGuangdong7.UnbundledEnergyAttributeCertificate(EAC)GreenElectricityCertificates(GECs)GECsareissuedbytheNationalInformationManagementCentreforRenewableEnergytoqualifiedrenewableenergygeneratorGECshavenoregionalorindustryrestrictions.AnyorganisationorindividualcanbecomebuyerofGECviatheInformationManagementPlatformofRenewableEnergy.Thefirstsubsidy-freeGECtransactioninChinatookplaceinJune2021.DuringtheDialogueonInternationalEnergyTransformation2021event,60flat-rateGECswerepurchasedfromademonstrativePVprojectownedby6RMI(2022).企业绿色电力采购机制中国市场年度报告：2021年进展、分析与展望Theseprovincesandregionsare:Beijing-Tianjin-Hebei,Shanxi,Jilin,Liaoning,Heilongjiang,Shaanxi,Gansu,Qinghai,Shandong,Fujian,Zhejiang,Hubei,Hunan,Jiangxi,Jiangsu,Guangdong,Sichuan,Yunnan,Chongqing,Guizhou,InnerMongolia,Xinjiang,Ningxia,Guangxi,Tibet7TechWeb(2021).首批绿电交易市场主体！腾讯数据中心积极响应国家双碳战略8companies.EachGEChasauniqueelectricidentificationcodeandcorrespondsto1MWhofon-gridelectricitypoweredbynon-hydrorenewableenergy.Onthesupply-side,onlyonshorewindandsolarPVprojects(excludingdistributedREgeneration)areeligibletoparticipateintheGECsystem.ChinaPowerInternationalDevelopmentLtd8.InternationalunbundledEACsTwomajortypesofinternationalunbundledEACsareI-RECandAPXTIGR.Bothrepresenttheenvironmentalattributesofthegenerationof1MWhofenergyproducedbyrenewablesources.I-RECandAPXTIGRareacknowledgedbyCDP,RE100andmanyotherinternationalreportingframeworks.Therefore,internationalEACsareoftenconsideredbymultinationalcompanies’regionalofficesandsupplychaincompanieslocatedinChina.FromJune2021,onlysubsidy-freeprojectscanapplyandregisterforI-RECsinChina.ForprojectsreceivingaFiT,theissuanceofI-RECswillceasenolaterthan1January20239.Thelargestsingleprocurementofflat-rateinternationalEACsinChinatookplaceinJuly2021.Inthistransaction,oneofApple’ssupplychaincompaniesinChinabought100,000APXTIGRsfromasolarproject,atapriceofCNY0.025-0.03perkWh.Thisisalsothelargesttransactionofflat-rateEACsglobally10.Directinvestmentinutility-scaleprojectCorporateusersinvestinrenewableprojectsdirectlyontheirownorthroughthirdparties.Investorseitherhavefullorpartialownershipoftheprojectstheyareinvestedin.Noregionalorindustryrestrictions,opentoallcompanies.In2016,AppleandGoldwindco-investedin285MWofwindprojectsinChina,withAppletaking30%ownershipoftheprojects11.8QQNews(2021).我国首单平价绿证交易完成9IRECStandard(2021).ChangeinissuancecriteriaforChinafollowingConsultation10WallStreetCN(2021).100000张！中国规模最大的平价绿证交易达成!11SinaFinance(2016).苹果扩张在中国新能源布局：入股金风科技旗下4家新能源公司9Generationfrominstallationsoncompanypremises/on-sitegenerationAnenterprisecaninstalldistributedPVorwindpowersystemon-site.Thegeneratedelectricitycanbeeitherconsumedbytheenterpriseorsoldtothegrid.Noregionalorindustryrestrictions,opentoallcompanies.In2017,JDLogisticsimplementedarooftopdistributedphotovoltaicpowergenerationsystematShanghaiAsiaNo.1IntelligentLogisticsPark.Thesolarcapacitywasofficiallyconnectedtothegridin2018andgenerated2,538,000kWhofelectricityin202012.DistributedmarkettransactionsCompaniesbuyexcessgreenpowerfromtheirneighbours’small-ormedium-scalerenewablesourcesviadistributionlines.In2019,alistofthefirst26distributedpowertradingpilotprojectswasapprovedandannounced.Thisfirstbatchofprojectsaccountedfor1.65MWintotal.However,notallofthemhavesuccessfullyproceededtotheoperationphase.JiangsuProvinceisleadingindistributedmarkettransactions.In2019and2020,transactionrulesandcontracttemplateswerereleasedtofacilitatethetransactionsintheprovince.Amongthe26pilotprojects,thefirstsuccessfulonewasa5MWprojectinJiangsuProvince.Itstartedoperationsattheendof2020.Theprojectisexpectedtogenerate6.8millionkWhperyearviaa‘solar+agriculturalcropsplanting’mode.Thepowergeneratedwillbetradedintheneighbouringarea13.12JD.com(2020).Environmental,SocialandGovernanceReport13SohuNews(2021).到2025年底，将达到分布式12G到2025年底，将达到分布式12GW、集中式14GW！江苏省“十四五”可再生能源规划征求意见稿出炉W、集中式14GW！江苏省“十四五”可再生能源规划征求意见稿出炉10WhenmakingREprocurementdecisions,corporatesusuallyneedtoconsideraccessibility,additionality,capitalinvestmentandcost.Onsitegenerationwillmostlikelybeprioritisedforgreenelectricityconsumptioniftherearenobarrierstoitsinstallatione.g.,inadequateroofsforsolarPV.Consideringtheadditionalityandcostsavingpotential,PPAsarepreferredbymanycorporates.DuetothelimitedaccesstoPPAs,manycompaniesinChinahavetopurchasetheunbundledEACstoachievetheirREconsumptiontargets,includingGECs,i-RECsandAPX-TIGR.Directinvestmentinutility-scaleprojectsusuallyrequireslargecapitalinvestmentandexpertiseintherenewableenergysector,andsoonlyleadingenterpriseswithlargeelectricityconsumptioncanconsiderthisoption.AccordingtothestatisticsfromRE100in2020,mostrenewableelectricityconsumedbyRE100membersinChinaissourcedthroughunbundledEACs,followedbydirectPPAs14.Figure1SourcingofREinChina,reportedbyRE100andCDPmembersin2020(RE100,2021)PoliciesforrenewableenergydevelopmentInChina,manypolicieshavebeenestablishedtoacceleratethedevelopmentofboththeREsectorandtheREtrademarket.Directsubsidieshaveplayedacrucialroleinscalingupthesectorandincreasingthesupplyofrenewableenergy.Forexample,Feed-inTariffs(FiTs)haveboostedwindandsolarcapacitybyaround10-foldand100-foldrespectivelywithinonedecade.However,FiTshavealsoraisedchallengessuchascurtailmentissues,squeezingoutpotentialtransactionopportunities,andburdeningpublicfinance.Overthelastfewyears,policieshavebeenimplementedtooptimisethepricingstructureofrenewableenergy,reducecurtailmentandincreasedemand,andpilotanational-levelgreenenergytrademarket.Accordingtothe14thFive-YearPlanforModernEnergySystem,Chinaplanstoincreasetheshareofnon-fossilfuelsinitselectricitysupplyto39%by2025,recognisingthelowcarbonenergytransitionasoneofthekeyactionsinthe14thFive-YearPlan15.14RE100(2022a).Steppingup:RE100gathersspeedinchallengingmarkets15ChinaGovernment(2022a).【关于印发《“十四五”现代能源体系规划》的通知(发改能源〔2022〕210号)】-国家发展和改革委员会(ndrc.gov.cn)UnbundledEACs60.30%PPAs33.52%Greentariffs4.94%Directline1.04%DefaultEACs0.21%UnbundledEACsPPAsGreentariffsDirectlineDefaultEACs11OptimisingthepricingstructureTheChinesegovernmenthasusedasetofpolicytoolstooptimisethepricingstructureofrenewableenergytomovetowardsazero-subsidyera.Thisincludestheuseofauctionstodecidethelevelofsubsidiesforsolarandwindprojects,launchingsubsidy-freepilotprojects,andgraduallyphasingoutsubsidies.1)AuctionsanddecreasingbenchmarkpricesforwindandsolarenergyChinaintroducedFiTpricingmechanismsforrenewableenergyin2009,whichhaspromotedthedevelopmentoftherenewableenergyindustryoverthepastdecade.WiththeincreasingdeploymentofrenewableenergyandthereductionoftheLevelisedCostofElectricity(LCOE)forrenewableenergy,thegovernmenthasgraduallyloweredtheFiTsovertheyears.In2019and2020,theNationalDevelopmentandReformCommission(NDRC)publishedaseriesofpoliciestoimprovetheFiTmechanismforrenewableenergy.Accordingtothenewpolicies,thepriceofnewwindandsolarenergyprojectsshouldbedeterminedviaauctionswhilefixedFiTswillbereplacedbybenchmarkpriceswhichwillfunctionaspriceceilingsfrom2019.ThefollowingtablesshowthedecreaseofFiTsandbenchmarkpricesforonshorewindandsolarenergyprojectsonanannualbasis16,17,18,19.Table2Benchmarkprices(fixedFiTorauctionedunderapriceceiling)forsolarenergy(CNY/kWh)2017201820192020Zone10.650.5≤0.4≤0.35Zone20.750.6≤0.45≤0.4Zone30.850.7≤0.55≤0.49Table3Benchmarkprices(fixedFITorauctionedunderapriceceiling)forsolarenergy(CNY/kWh)2017201820192020Zone10.400.40≤0.34≤0.29Zone20.450.45≤0.39≤0.34Zone30.490.49≤0.43≤0.38Zone40.570.57≤0.52≤0.4716NDRC(2016).关于调整光伏发电陆上风电标杆上网电价的通知(发改价格〔2016〕2729号)17NDRC(2018).关于2018年光伏发电有关事项的通知(发改能源〔2018〕823号)18NDRC(2019).关于完善光伏发电上网电价机制有关问题的通知(发改价格〔2019〕761号)19NDRC(2020).关于2020年光伏发电上网电价政策有关事项的通知(发改价格〔2020〕511号)122)Subsidy-freepilotprojectsTheChinesegovernmenthavebeguntoencouragesubsidy-freepilotprojects.Inearly2019,theNDRCandNationalEnergyAdministration(NEA)announcedANoticeonProactivePromotionforSubsidy-freeWindandSolarProjectsIntegrationintotheGrid.Aseriesofsupportingmeasureswereproposedtosupporttheconstructionofsubsidy-freeprojects.Forexample,localmunicipalitiesshouldreducenon-technicalcostsforloworzero-subsidyprojectsbyadjustingland-usetaxandresourcetransactionfeestoencouragepilotprojects.Anotherexampleisthatgridcompaniesshouldguaranteetheintegrationofallgeneratedelectricityfromsubsidy-freeprojects.Theseprojectsarealsoallowedandencouragedtoreceiveadditionalincomethroughtradinggreenelectricitycertificates.3)PhasingoutsubsidiesThenewmilestonepolicyofphasingoutsubsidieshasbeenimplementedafterloweringbenchmarkpricesforrenewableenergyandpilotingsubsidy-freeprojects.In2021,theNDRCimplementedANoticeonFiTPolicyofRenewableEnergy.Accordingtothenotice,newlyregisteredutility-scaleandcommercialandindustrial(C&I)distributedsolarprojectsandnewlyapprovedonshorewindpowerprojectswillnotreceivesubsidies.Pricesforthesetypesofnewprojectsaresettothelocalcoal-firedpowerbenchmarkprices.Inthemeantime,newprojectsareallowedtoparticipateinmarkettransactionsonavoluntarybasistoachieveabetterpayofffortheenvironmentalvalueofrenewableenergy20.ReducingcurtailmenttoincreaseconsumptionforrenewableenergyInMay2019,thelong-awaitedRenewablePortfolioStandard(RPS)policywasformallyreleasedfollowingthreeroundsofcommentsbyNDRCandNEA.Afterwards,provincial-levelRPSpoliciesandimplementationplanswereissuedaccordingly.ThemainobjectiveoftheRPSistoensureminimumrenewableenergyconsumptioninprovincesandtoallocatetheresponsibilitiesforrenewableconsumptionfairlyamongenergy-intensiveconsumers.TheRPSrequeststhatprovincial-levelgridcompanies,retailers(load-servingentities),buyersdirectlyparticipatinginPPAtransactionsandbuyerswithself-suppliedpowerplantsmeetarenewableelectricityconsumptiontarget.TheRPSliststhreewaystofulfiltheobligation21:•ConsumingrenewableelectricityfromonsitewindandsolarprojectsorPPAsofwindandsolar(wheretransactionsareavailable)•Purchasingrenewableenergyfromotherobligatedpartiesthathaveexceededtheirowntargets•PurchasingvoluntaryGECstooffsettheamountofelectricityobligatedtothemTheRPSwillcontinuetoplayacrucialroleinChina’stransitiontorenewableenergy.AccordingtotheDraftDocumentforCommentsonRPSTargetfor2021andfor2022-2030,releasedbytheNEAinFebruary2021,newtargetsof40%REconsumptionand25.9%non-hydroREconsumptionby2030wereproposed.Thiswillrequirea1.47%increaseinnon-hydroREconsumptionyear-on-yearfrom2021to203022.Thoughthefinaldocumentonlyannouncedtheprovincial-leveltargetsandresponsibilitiesfor2021and2022,itisexpectedthatthetargetswillincreaseannuallyinordertoachieveChina’senergytransitiontargetsof20Solarbe(2021).2021年新能源上网政策全面解读：不再补贴，实行平价上网21RMI(2019).StateofTheMarket2019:CorporateRenewableProcurementinChina22ChinaGovernment(2021b).国家能源局征求意见：2021-2030年各省光伏、风电消纳责任目标(yq.gov.cn)1320%non-fossilfuelenergyuseby2025and25%by203023.TheRPSschemewillbeessentialinmandatingrenewableenergydemand.GreenpowertrademarketPoliciesreleasedinrecentyearsdemonstrateaclearambitionfromtheChinesegovernmenttoestablishawell-functioningandhigh-performingmarketforgreenelectricity.High-levelgoalsaresetandpublishedintheGuidingOpiniononAcceleratinginBuildingaNationalPowerMarketSystem,publishedbytheNDRCandNEAinearly202224.Aunifiednationalpowermarketwillinitiallybedevelopedin2025,withasignificantincreaseinthescaleofgreenpowertransactionsandfavourablemechanismsforREdevelopment.In2030,theunifiednationalpowermarketwillbeestablishedwithrenewableenergyfullyparticipatinginmarkettransactionsonalevelplayingfield.Inthepastsixmonths,aseriesofpolicieshavebeenreleased,whichhaveacceleratedthegreenpowertradeinChina.In2021,thegovernmentapprovedtheGreenPowerTradingPilotWorkPlandevelopedbytheChinaNationalGridandChinaSouthernGrid,toestablishthegreenpowertrademarketinChina.AccordingtothePlan,windandsolarenergygenerators,consumersandretailers,andgridcompaniesareallowedtoparticipateingreenelectricitytransactions.Thescopeofgreenpowerproductsmainlyincludeswindandsolarpowerinthefirststage.Itwillalsoextendtocoverqualifiedhydro-poweredelectricityatalaterdate.ItwillbeanindependentproductunderChina’sexistingmediumandlong-termpowertradeframeworkandwillbeorganisedandexecutedasapriorityinmarkettransactionsandgridoperations.InSeptember2021,thegreenpowertradepilotwaslaunched,achieving7.9billionkWhintotaltradevolumesbetween259participantsfrom17provincesinthefirstday.ThetradepilotwasorganisedbyChinaSouthernPowerGridandChinaStateGrid,jointlysupportedbythetwopowerexchangecentresinBeijingandGuangzhou.InFebruary2022,thedetailedtransactionrulesforgreenpowertransactions(trial)wereissuedinfivesouthernprovinces,namelyGuangdong,Guangxi,Yunnan,GuizhouandHainan.TherulesclarifythatsellersofgreenelectricityareREgeneratorsqualifiedforGECissuance,whichtodatehavemainlybeenonshorewindandsolarprojects.TherulesalsomentionthattherangeofqualifiedsellerswouldgraduallybeextendedtoincludehydroandotherREgenerators.Thebuyersofgreenelectricityareelectricityusersorretailers.ThetransactionproductsaregreenelectricitybundledwithGECs,withtheGECstransferredfromthegeneratorstotheconsumerstoalignwiththetransactions.Withregardstodistributedmarkettransactions,anewpolicy25releasedbytheNEAinDecember2021highlightstheneedtoimprovethemarkettransactionmechanismandpromotetheparticipationofdistributedpowergenerationinthegreenelectricitymarket.Itisexpectedthattherewillbemoredetailedpoliciesorimplementationplansannouncedtoacceleratethedevelopmentofdistributedmarkettransactions.23ChinaGovernment(2021c).国家发展改革委国家能源局关于2021年可再生能源电力消纳责任权重及有关事项的通知_电力_中国政府网(www.gov.cn)24ChinaGovernment(2022b).国家发展改革委国家能源局关于加快建设全国统一电力市场体系的指导意见25ChinaNationalEnergyAdministration(2021).国家能源局关于印发能源领域深化“放管服”改革优化营商环境实施意见的通知国能发法改〔2021〕63号-国家能源局网站(nea.gov.cn)14PotentialdemandforrenewableenergywillgrowTheChinesegovernmenthaverecentlyreleasedasetofpoliciesthatdemonstrateitscommitmenttoincreasingthedemandforrenewableenergy.InJanuary2022,theNDRC,MinistryofIndustryandInformationTechnology(MIIT)andfiveotherbureausannouncedtheImplementationPlanforPromotingGreenConsumption.Intheplan,onewholesectionisdesignatedtofurtherstimulatingthepotentialdemandforgreenelectricityatthenationallevel.Theplanencouragesleadingenterprisesinvariousindustries,largestate-ownedcompanies,andmultinationalcorporatestoconsumegreenelectricity.Italsohighlightstheimportanceofmotivatingexport-orientedenterprisesandregionswithhigheconomicaffordabilitytograduallyincreasetheirpercentageofgreenelectricityconsumption.Besidesthis,italsomentionslinkinggreenelectricityconsumptionwiththecarbonemissiontradingmarket.InFebruary2022,theNDRCandNEAreleasedanotherpolicyonimprovingthegreenandlowcarbontransformationmechanismintheenergysector,whichproposestoimprovethemechanismandpolicysystemsforpromotinggreenenergyconsumption26.Itincludedimprovingtheenergy’doublecontrol’policytoexcludenewrenewableenergyintotalenergyconsumptioncontrol,promotingGECtransactionsandencouraginggreenenergyconsumption.Thisisaveryclearsignaltothemarketthatdemandforrenewableenergywillgrowinthenearfuture.EstimationofdemandsizeREprocurementdemandfromRE100commitmentsSevenChinesedomesticcompanieshavejoinedtheRE10027initiative,twoofwhicharenolongermembers28.OutofthecurrentfiveRE100members,fouraregreentechnologycompanies.Themostrecentmember,Chindata,isaleadingdatacentresolutionprovider,signallinginterestfromtheITsector—averycarbon-intensiveindustry—tobegindecarbonisationefforts.ThetablebelowshowsthelistofbothcurrentandformerChineseRE100members,theirrenewableenergytargetsandprogressmadein2019and2020.Itisencouragingtoseethatexistingmembersjoinedfrom2019onwards,withambitioustargetsrangingfrom2025to2040.Allmembershavemadeprogressinreachingthese.Table4RE100targetofcurrentChinesemembers29CompanySectorJoiningyearRE100targetyearInterimtargets%RE2020%RE2019ChindataIT20212040N/AN/AN/A26ChinaGovernment(2022c).国家发展改革委国家能源局关于完善能源绿色低碳转型体制机制和政策措施的意见_节能与资源综合利用_中国政府网(www.gov.cn)27RE100isaglobalcorporateinitiativethatbringstogetherbusinessescommittedto100%renewableelectricity28BroadGroupandElionhavenotbeenlistedasmembersinthelatestRE100AnnualReport2021.Itisunclearwhethertheywereremovedduetolackofreportingin2020oriftheyhaverenouncedtheircommitments.29RE100(2022a)Ibid.15SungrowGreentech2020202860%by202523%11%LONGiGreentech2020202870%by202742%15%EnvisionGroupGreentech2019202550%by20233%3%JinkoSolarGreentech2019202550%by202270%by202385%by202430%18%DespitethesmallnumberofdomesticcompaniescommittedtoRE100,manyinternationalreportingRE100membershaveoperationsinChina.Withincreasingpressureformulti-nationalcorporationstoaddressthecarbonimpactsoftheirglobaloperationsandsupplychains,thereisstrongdemandfromtheoverseasmarketinprocuringrenewableenergyinChina.AccordingtotheRE100AnnualReport2021,Chinaisthird-biggestmarketforsourcingrenewableelectricity.ThechartbelowshowsthetrendinrenewableenergyconsumptionandgrowthofRE100memberswithoperationsinChina,includingdomesticcompanies,across2017,2019and2020asreportedbyRE100members30.Figure2RE100members’sourcingofrenewableelectricityinChinaSourcingofrenewableelectricityhasmorethantripledbetween2019and2020,from1,622GWhto5,290GWh.Totalconsumptionofelectricityhasalsorisenfrom2,914GWhin2017to7,816GWhin2020.Inlinewiththistrend,RE100memberswithoperationsinChinahavealmostquadrupledbetween2017and2020.Asmorecompaniesbegintotakeactiontoreducetheiremissions,demandforrenewableenergyinChinawillonlyrisegiventhelargenumberofcorporatesupplychainpartnersbasedinChina.BloombergNewEnergyFinanceanalysisshowsthatrenewableelectricitydemandfromsupplychaincompaniesand30RE100datawasunavailablefor201925%19%40%75%81%60%238392010203040506070809010002000400060008000100001200014000201720192020NumberofcompaniesElectricityconsumption(GWh)RE100members'sourcingofrenewableelectricityinChinaRenewableNon-renewableCompaniesreportingoperationsinChina16domesticRE100membercompanieswillreachatleast116,000GWhin203031.MeetingtherenewablepowerprocurementneedsofenterpriseswillbecomeanecessaryrequirementforChinaifitistoretainitssupplychaincompanies.ThereisalsoagrowingtrendofChinesecorporatesjoininginternationalinitiativestodemonstratetheircommitmenttoclimatechange.AnexampleofthisistheScience-BasedTargetsinitiative(SBTi),where57companieshaveeithersetorcommittedtosettingemissionsreductiontargets32.Partofthisjourneywillincludemovingtowards100%renewableelectricityconsumption.ThecombinationofbothinternationalanddomesticdemandwillpushChinatowardsbecomingtheworld'slargestcorporaterenewableelectricitytradingmarket.REprocurementdemandfromdatacentresChina’sITsectorhasbeengrowingatarapidspeedandhasbecomealargeconsumerofelectricity.Inrenewableelectricitytransactionstodate,datacentresplayanactiveroleinseekingandbuyinglargevolumesofgreenelectricity.AccordingtoBloombergNEF,thetoptwocleanenergybuyersinChinawereAlibabaCloudandChinData,bothfromthedatacentresector.GDS,anotherleadingdeveloperandoperatorofhigh-performancedatacentres,alsocommittedtoachieve100%renewableenergyconsumptionandcarbonneutralityby2030intheirESGreportin2021.ThoughtheestimationofelectricitydemandofdatacentresinChinavariesaccordingtodifferentinstitutionsandresearch,33,34,35theyallreachaconsensusthatelectricitydemandfromthissectorwillgrowrapidly.AccordingtoGreenpeace,China’sdatacentresconsumed150.7TWhofelectricityin2020,equivalentto2%ofChina’stotalelectricityconsumption.Thisisprojectedtotripleby2035,rangingbetween450.5TWhand485.5TWh36.Ifdatacentresaretoconsumeaminimumof60%renewableenergyinlinewithRE100requirements37,totalREdemandfromthesectorinChinawillreachatleast270TWhby2035.REprocurementdemanddrivenbydomesticpoliciesSinceChinaannouncedin2020itscommitmenttoachievepeakemissionsby2030andcarbonneutralityby2060,manyChinesecompanieshavestartedtodeveloptheirownemissionsreductiontargets.Greenelectricityprocurementwillbeoneofthemostimportantemissionsreductionmeasurestaken,giventhatelectricityisthelargestsourceofemissionsformostcompanies.In2016,ChinaimplementedtheDualControlofEnergyConsumptionPolicytoreduceenergyintensityandlimittotalenergyconsumption;akeymeasuretowardsachievingitsenergyandclimatetargets.Inthe2021CentralEconomicWorkConference,thegovernmentproposedthatnewrenewableenergywillnotbeincludedinthetotalenergyconsumptioncontrol,withtheaimoftransitioningfrom‘doublecontrol’31ThePaper(2021).Ontheroadtocarbonneutrality,multinationalcompaniesareincorporatingtheirsuppliers'carbonreductionperformanceintotheirprocurementdecision-makingsystems32SBTi(2022).CompaniesTakingAction33Greenpeace(2021).中国数字基建的脱碳之路：数据中心与5G减碳潜力与挑战（2020-2035）34GreenpeaceandNorthChinaElectricPowerUniversity(2020).点亮绿色云端中国数据中心能耗与可再生能源使用潜力研究35CDCC(2021).2021年中国数据中心市场报告36Greenpeace(2021).Ibid.37RE100(2022b).TechnicalGuidance17ofenergyconsumptionto‘doublecontrol’oftotalcarbonemissionsandintensityassoonaspossible.Inthenewlyreleased14thFive-YearPlanforaModernEnergySystemaswellastheGovernmentWorkReportdeliveredbyPremierLiKeqiang,itismentionedagainthatadditionalrenewableenergywillbeexcludedfromtotalenergyconsumptionaccounting38.Accordingtothe14thFive-YearPlanonEnergySavingandEmissionsReduction,additionalusageofrenewableelectricitybetween2021and2025willnotbecountedundertheregionaltotalenergyconsumptioncontrol39.Thesepolicieswilldrivefurtherdemandforgreenelectricityconsumption,especiallyforthefast-growingenterprisesinenergy-intensiveindustries.IntheImplementationPlanforPromotingGreenConsumptionreleasedinearly2022,theChinesegovernmentisgoingtoexploretheconnectionbetweenthecarbonemissionstradingsystem(ETS)andgreenelectricityconsumption.Thismeansthatgreenelectricityconsumptionwillbeconsideredasanemissionsreductionmeasureinthecarbonmarket.ThiswillprovidedirectmotivationforcompaniesinvolvedintheETStoprocuregreenelectricity.ThePlanalsoencouragesleadingindustrialenterprises,largestate-ownedcompanies,andmultinationalcorporatesaswellasexport-orientedcompaniestoconsumegreenelectricity.Assuch,wecanexpectthatdemandforrenewableenergyfromdomesticcompanieswillgrow.BarrierstocorporateREprocurementChinahasbeenidentifiedbyRE100membersasoneofthemostchallengingmarketsforachieving100%renewableelectricityinboth2020and2021.Despitetheintroductionofmarketreformsaimedatacceleratingthedevelopmentoftherenewablepowermarketandseveralmechanismstoimprovecorporateaccesstoprocurerenewableelectricity,regulatorycomplexities,limitedtonoavailabilityofsupplyinsomeregionsandlackofPPAshavebeencitedaskeybarriersinpreventingcorporatesfromrealisingtheirrenewableelectricitytargets40.AgainstthebackdropofChina’spledgetoachievecarbonneutralityby2060andglobalcommitmentsfrommulti-nationalcorporationstoaddressthecarbonimpactsoftheirinternationaloperationsandsupplychains,thereisgrowinginterestfrombothoverseasanddomesticcompaniesoperatinginChinainprocuringrenewableenergy.However,existingbarriersneedtobeaddressedfirstinordertocreatetherightmarketconditionsthatwouldenableasignificantscale-upofrenewableenergyinvestmentandtransactionsfromtheprivatesector.ThissectionwillexplorethelimitationsofPPAsandGECs,whicharethemainmechanismsforlarge-scalecorporateprocurement.Itwillalsogiveabriefoverviewofthechallengessurroundingotherprocurementmechanisms.BarriersofPPAsLackofPPAshasbeencitedasakeybarriertorenewableprocurementinChinabyRE100members.WhileseveralnewpolicieshavebeenintroducedtoexpandaccesstoPPAs,therearestillanumberofregulatorycomplexitieswhichhavepreventedlarge-scaleuptakefromcorporates.Currently,mostprovincesinmainlandChinaallowcorporateconsumerstodirectlysignPPAswithpowergeneratorswithwindandsolarassets.However,onlylimitedprovinceshavenormalisedgreenelectricitytransactions.38ChinaGovernment(2022d).2022年李克强总理作政府工作报告_中国政府网(www.gov.cn)39ChinaGovernment(2022e).国务院关于印发“十四五”节能减排综合工作方案的通知（国发〔2021〕33号）_政府信息公开专栏(www.gov.cn)40RE100(2022a).Ibid.18Althoughthenational-levelgreenpowertradepilotlaunchedinSeptember2021,onlylargesuppliershavebeeninvolvedandtransactionsarenotorganisedregularly,leadingtoinsufficientsupplyandlimitedaccessforcorporatebuyers.Currently,transactionsaregenerallylimitedwithinasingleprovince,andbothpartiesmustbeincludedonthegovernment-approvedlistinordertotransactthroughtheprovincialpowerexchange.Greenpowertradingrulesalsooftenvarybetweenprovinces,makingitdifficultandexpensiveforcorporateswithmultipleofficesandfactoriesacrossseveralprovincestotransactin,astheywillneedtofollowdifferentsetsoflocalpolicies41.Inter-provincialtransactionsareevenmorerestrictedbyChinesemarketrulesandaretypicallylimitedtogridcompanies.Thetransactionprocessisusuallynotsimple,asadministrativesignoffsfrommultipleprovincialgovernmentandlocalpowerstakeholdersarerequired.Thiscanbeextremelychallengingforcorporatebuyerstonavigate42.Thelimitationofinter-provincialPPAsmeansthatrenewableenergygeneratorsmustbelocatedwithintheprovinceofthecorporatecustomers’electricityload.ThisposesafundamentalproblemasthemajorityofChina’seconomicallyefficientrenewableenergyproductionisinthenorthernandwesternprovinces,awayfromdenselypopulatedareaswheremostenergy-intensivecompaniesarelocated43.Inthegreenpowertradingpilot,whichtookplaceinSeptember2021,inter-provincialtransactionsaccountedforonly20%oftotalelectricity.ChallengesofGECsChinaintroducedtheGECsystemasapilotprogrammein2017toallowbusinessesandindividualstopurchaserenewableenergyvoluntarily.UnliketypicalEACswhicharetraditionallydesignedasanaccountingmechanismtodocumentthegenerationanduseofrenewableenergy,China’sGECwasdevelopedwiththeprimarypurposeofreducingFiTsubsidies.Initially,onlyrenewableenergygeneratorseligibleforFiTswereabletoissueGECs.Theycaneitherchoosetosellthecertificatestocustomerswantingtomakearenewableenergyclaimorreceivethesubsidypayment.Assubsidypaymentscanoftenbesignificantlydelayed,generatorsmayfavourreceivingmoreimmediaterevenuesfromsellingGECs44.However,themarketforGECshasnotbeenveryactive,duetoitshighpriceswhicharecappedatthesamerateasgovernmentsubsidypayments.Thisrepresentsasignificantpremiumforcorporatecustomerscomparedtoelectricitygeneratedfromconventionalsources,withfewdomesticcorporationsinChinawillingtopaythisadditionalcostforenvironmentalattributes.In2019,aspartofatransitionawayfromnationalsubsidiesforwindandsolarpower,theChinesegovernmentannounceditsplanstolaunchsubsidy-freeprojects,statingthattheseprojectscouldissueGECs.ThishashelpeddecoupleGECsandsubsidyprices,makingitamoreattractiveoptionforcorporatestopurchaserenewableenergyattributes.GECsissuedfromsubsidy-freeprojectsarenowbeingsoldatreducedprices,reflectingcorporatebuyers’willingnesstopay45.AsofFebruary2022,thetotalnumberofGECsfromsubsidy-freeprojectsissuedisapproximatelyfivemillion,witharound0.94millionsold,representingaround19%,muchhigherthantheprojectswithsubsidy(lessthan0.1%sold)46.41Basedoninterviewswithindustrystakeholders42CRS(2019).Ibid.43HundtandJahnel(2021).Decarbonisation&PowerPurchaseAgreements–AneconomicanalysisoftheregulatorystatusquoinChina44HundtandJahnel(2021).Ibid.45RMI(2019).Ibid.46Greenenergy.org.cn(2022a).Statistics19Despitebeingfeasibleonapolicylevel,thetransactionofGECsfromsubsidy-freeprojectsisstillarelativelynewconceptinthemarket.Thisisespeciallytruegiventhatmostoftheseprojectswereonlycommissionedfrom2021onwards.ComparedwiththeAPX-TIGRandi-RECwhicharefullyrecognisedbyRE100,theGEChasnopriceadvantageandislessrecognised.Asaresult,manyinternationalcompanieslookingforEACsfavouri-RECandAPX-TIGR.Additionally,corporatesmayalsolackthemotivationtopaytheextracostforrenewableenergy,reflectingthelackofpressureplacedoncompaniestotransitionto100%renewableenergyfromthegovernment47.Tocomplicatethingsfurther,thelaunchoftheRenewableEnergyPortfolioStandard(RPS)in2020resultedintwotypesofmarketsforGECs:compulsoryandvoluntary.Underthisnewregulation,GECscanbeusedbyobligatedentitiestofulfilcompulsorytargets48,alongsidecorporateswhobuyGECstomeetvoluntarytargets.However,theoverlapofthetwomarkets,coupledwiththeabsenceofatransparentaccountingsystemforissuing,trackingandcertifyingGECsgivesrisetoasystematicdoublecountingissue,raisingconcernsandgeneratinguncertaintyaroundclaimsonrenewableattributes49.Forexample,whenagridcompanyconsumesacertainamountofrenewableelectricitytomeetitsRPStarget,theamountthatitintendstoclaimmayalreadyhavebeenissuedwithacorrespondingamountofGECsandsoldtoacorporatebuyer.Inthiscase,eitherthegridcompanycanclaimithasalreadyconsumedtherenewableelectricity,orthecorporatebuyercouldmakeaclaimonthesamerenewableelectricityissuedwithGECs.Thisresultsinthesameamountofrenewableenergyproductionbeingcountedtwiceinthesystem,preventingexclusiveownershipofclaimsontheuseofrenewableelectricityanditsattributes50.InAugust2020,CDPundertookapreliminaryassessmentoftheGECsystemagainsttheRE100technicalcriteriaforacceptableprocurement,inresponsetorequestsfromstakeholders.TheassessmentconfirmedthattheGECsystemisunabletoguaranteeexclusiveclaimsbytheuserduetotheissuesofdoublecountingofenvironmentalattributesacrossGEC,GHGoffsets(ChinaCertifiedEmissionReduction,CCER),andothercertificatesystemsoperatinginChina51,52.FortheGECsystemtofunctioneffectively,furtherimprovementsarerequiredtoreducetheriskofdoublecountingbetweentheexistingvoluntaryGECmarketandthenewcompulsoryGECmarketundertheRPSandtheCCER.Indoingso,corporateuserscouldcrediblyusethismechanismtohelpfulfiltheirrenewableelectricitytargets.AnadditionalcomplicationforGECsistheexistenceofadifferentcertificationsystemforPPAs.Alongsidegreenelectricitytransactions,powerexchangecentrescanalsoissueGreenPowerCertificatesorGreenPowerTransactionCertificatestocustomers.Figure3showsthecertificateissuedbytheBeijingPowerExchangeCentreforPPAsandtheGEC.Thetwotypesofcertificatesissuedbydifferentorganisationsmakesthesystemmorecomplicatedandconfusing.Italsoincreasestheriskofdoublecountinggreenattributesifthetwosystemsarenotcoordinatedandlinked.InthenewlyreleasedgreenelectricitytransactionrulesforSouthChina,GECswillbeusedasthecertificateforconsumerswho47Greenpeace(2021).RacetoGreen:ScoringTechCompaniesfromChina,JapanandSouthKoreaontheirClimateActionandRenewableEnergyUse48RE100(2020).GreenElectricityCertificate(GECs)ofChina49BritishChamberofCommerce(2021).BritishBusinessinChina:PositionPaper50Integral(2021).UnveilingRE100Roadmap:TheWayto100%RenewableElectricityinChina51Theassessmentfurtherstatedthatcredibleclaimscanonlybemadeifthereisownershipofallenvironmentalattributesassociatedwiththegeneration,andthatnoneoftheseattributeshavebeensoldoff,transferred,orclaimedelsewhere.52RE100(2020).Ibid.20participateinthetransactions.AuniquecertificateshouldbeusedforgreenelectricitytransactionsindifferentprovincesalongsideGECs.Figure3AGreenPowerCertificate(left)versusaGreenElectricityCertificate(right)53,54LimitationsofotherprocurementmechanismsWithregardstotheothermechanismsavailabletocorporatesforprocuringrenewableenergy,eachhavetheirownrespectivelimitations.Forexample,distributedmarkettransactionsarecurrentlybeingpilotedbytheChinesegovernment.Despitetheschemelaunchingin2017,only26pilotprojectswereannouncedin2019afterexperiencingseriousdelays.Todate,onlyonehasbeensuccessfulthusfar55.Distributedmarkettransactionsarethereforedevelopingslowly,whichislargelyduetothelackofmotivationfrompowergridswhoseprofitswillbeaffected.Anewpolicyreleasedinearly2022emphasisesthepromotionofdistributedmarkettransactionsandtheimprovementofthetransactionmechanism.Itisexpectedthatthiswillbeacceleratedlaterintheyear.Itshouldbenoted,however,thattheamountofenergythatdistributedprojectscangenerateistypicallytoosmallinscaletomeettheelectricloadoflargecorporationsormanufacturersandcanonlyproduce5-10%ofthetotal56.Onsiterenewablegenerationhasasimilarproblem,typicallygeneratingevenlessthandistributedprojects,thusmakingitachallengetofulfil100%renewableelectricitytargets57.Directinvestmentinrenewableenergyprojectsbycorporateshasbeenlimited,andisnotapopularoptionforthosewhosecorebusinessisnotenergy58.Barriersincludethelargeamountofupfrontcapitalrequiredforinvestment,extensiveduediligenceandcompliancechecksneededtoidentifygoodprojects,53ZhejiangNews(2021).买下300000000度绿电！62家浙企抢单国内首场绿电交易54Greenenergy.org.cn(2022b).HonourList55BritishChamberofCommerce(2021).Ibid.56RMI(2019).Ibid.57CRS(2019).Ibid.58RMI(2019).Ibid.21anduncertaintyontheeconomicsandprofitabilityofprojectsbuiltinprovinceswithhighcurtailment59.Itisalsodifficultforcorporatestoobtainhigh-qualityprojectsastheyareindirectcompetitionwithlargepowergenerationcompanies.4.CorporateREprocurementlandscapeintheUKCurrentavailableoptionsforcorporateREprocurementLikeChina,theUKelectricitymarkethasmultipleoptionsforcorporateprocurementofrenewableenergywhichhavebeenenabledbyUKgovernmentpolicy,reducedtechnologycost,andincreasedprivatesectordemand.Theseoptionscanbebroadlycategorisedintoself-generation,PPAsbetweengeneratorsandcorporateconsumers,andgreentariffsbackedbyRenewableEnergyGuaranteesofOrigin(REGOs)providedbyacompany’senergysupplier.59CRS(2019).Ibid.22Table6CurrentlyavailableREprocurementoptionsforcorporatesintheUKREconsumptionoptionsDescriptionVariationsBenefits/ProsRisks/ConsCurrentsituation2022Directinvestmentforself-generationandconsumptionCorporationinvestsinandownstherenewableenergyassetprimarilyforself-consumptionOnsiteornearby:Corporateconsumerownsandmanagestheasset;receivesgeneratedelectricitybehindthemeterCorporateconsumercanmanageandsecuretheirownenergy;highadditionality;highCSRandESGvisibility;cansellexcessenergytothegridwithconnection;leasingremovesupfrontcapitalcosts;avoidsgridusechargesifallenergydemandiscoveredbyrenewablegenerationIfself-owned,corporateisliableformanagingrisksandsecuringsignificantupfrontcapitalinvestment;remainingonsitecanrestrictthescaleoftheinstallationMostcommercialandindustrialon-siteassetsaresolarPVinstallations60.Leased:Corporateconsumerleasesoutcompanypropertytoathird-partywhichownsandoperatestheon-siteinstallation(e.g.,roof-topsolar),leasingitwithafixedmonthly/annualleasingfeeCorporatePowerPurchaseAgreementAcontractualagreementbetweenacorporateconsumerandarenewableenergygeneratorwherethecorporatecommitstopurchasingPrivatewire:renewableassetisownedbyarenewableenergygeneratorwhosellselectricitydirectlytothecorporateconsumerwhoisoftenlocatedwithina10kmradiusviaaprivateconnection,RenewableenergygeneratorscanconnecttothegridandsellresidualpowerandassociatedREGOstoautility;noupfrontcapitalinvestmentforPrivatewirePPAcontractlengthtendstobelonger-term(15-20+years)reflectingtheextrainvestmentintheprivatewireconnection;p/kWhofferedbytheAsof2020,theUKhadprocuredover1,000MWofcorporatePPPAs62.ThelargestcorporatePPAsignedinUKwasAmazon’s350MWnew60RE-Source(2020).IntroductiontoCorporateSourcingofRenewableElectricityinEurope62WindEurope(2021).Financeandinvestmenttrends202023aspecificamountofenergy,orthetotaloutputofarenewableasset,atanagreedpriceforanagreedamountoftime.withoutconnectiontothegrid61corporateconsumer;fixedenergypricesforboththecorporateconsumerandgeneratorprovideahedgeagainstelectricitymarketvolatility;privatewirePPAsavoidgridusecharges;syntheticPPAsoffersignificantflexibility,benefitingcorporateswithmultiplelocationsastheirconsumptionandgenerationdonothavetooccurwithinthesamegrid;allPPAsprovideadditionality.consumerisoftenhigherthanwouldbeofferedunderotherPPAmodelsbecausetheconsumeravoidsadditiongridusecharges.CorporateconsumerswithsleevedandsyntheticPPAsarestillliableforallnon-commoditycostsassociatedwitheachunitofenergyconsumedandanyadditionalsupplieradministrativefees.offshorewindfarminScotland63.PPAsoriginallyrequiredcontractsspanning20yearstoprovidesufficientsecuritytothegeneratorandpaybackperiodfortheconsumer;however,inrecentyearsasPPApriceshavefallencontractlengthshavealsofallenandcanbeasshortas5-10years64.CITsectorisleadingPPAsgloballyandwithintheUK65.VirtualPPAsarenotcommonintheUK66.Sleeved:Anelectricitysupplierentersback-to-backcontractswitharenewableenergygeneratorandcorporateconsumerwhobuystheenergyproducedbythegeneratortransmittedthroughthegridfromthesupplier.Synthetic:OftencalledafinancialorvirtualPPA;involvesafinancialratherthanphysicalenergytransfer.Acorporateconsumerandrenewableenergygeneratoragreetoastrikepriceforanagreedperiod,duringwhichthegeneratorsellselectricitytothegridandthecorporatecontinuestobuyitselectricityfromitsnormalsupplier.61RE-Source(2020).Ibid.63OffshoreWIND.biz(2021).AmazonRevealsOffshoreWindPlayinUKOffshoreWind64Baringa(2021).RenewabletariffsintheUK:whatmakesatariffgreen?65WindEurope(2021).Ibid.66CrownCommercialService(n.d.).IntroductiontoPowerPurchaseAgreements24GreenTariff67Tariffofferedbyalicencedsuppliertoacorporateconsumer,whichspecifiesthatsomeoralltheenergyis‘matched’bypurchasesofrenewableenergythatthesuppliermakesonbehalfoftheconsumer.Investmenttariff:supplierusesfundsfromcustomerbillstodirectlyinvestinnewrenewablegenerationassets.Noupfrontcapitalinvestmentrequired;investmentandpartnership-basedtariffssupportadditionality.Alltariffsofferasimple,flexible,andrelativelycheapmethodforrenewableenergyprocurement;greentariffswidelyavailableacrosstheUK.Certificate-backedtariffshavebeencriticisedforgreenwashingasenergyprovidedmayonlybegeneratedfromnon-renewableresources,whilesupplierscanbuyunbundledEACstoinaccurately‘greenup’theirfuelmix;unbundledEACsdonotprovideadditionality;purchasingGoOsdoesnotcontributetoUKdecarbonisation;doesnotprovidelong-termpricestabilitytocorporateorgeneratorIntheUK,overhalfofthe315tariffsonsalein2019claimedsomerenewableenergycredentials68.IntheUK,tariffsmarketedasgreengrewfrom9%in2016to~50%ofthemarketthreeyearslater69.WhiletheRE100hasrecordedashiftawayfromgreentariffstowardPPAs,acrossEurope,greentariffsandunbundledEACsaccountedfor87%ofgreenelectricityproductsavailableinEurope’ssinglemarket70.Partnershiptariff:supplierbuyspowerdirectlyfrommultiplesmall-scalerenewablegeneratorshelpingtobringthemtomarket.Certificate-backedtariff:supplierbuys(often)unbundledEACs—UKRenewableEnergyGuaranteesofOrigin(REGOs)orEuropeanGuaranteesofOrigin(GoOs)—thatareissuedtorenewablegeneratorswhentheygeneratepower.67GoodEnergy(2020a).RenewableEnergyTariffs:TheProblemofGreenwashing68CCC(2020)CorporateProcurementofRenewableEnergy:ImplicationsandConsiderations69GoodEnergy(2020b).RenewableenergyinEurope:AnanalysisofhowUKenergysuppliersuseGuaranteesofOrigincertificates70RE100(2022a).Ibid.25MotivationofUKcorporatestoprocurerenewableenergyTheprivatesectorisincreasinglyturningtowardsrenewableenergy,mostoftenviagreentariffsandPPAs,to:•Reduceemissionsandachievenetzerotargets:AcrosscompaniesintheUKwithacarbonreductionstrategy,39%saytheyareprocuringrenewableenergy,whichisthefourthmostpopularactivitywithinacarbonreductionstrategy71.•Fixandlowerelectricityprices:Renewablesareincreasinglycheaperthanfossilfuels.In2021,UKaveragewholesaleelectricitypricesmorethandoubledcomparedtotheprevioustwoyears,furtherincreasingthecostcompetitivenessofwindandsolar,offeringthebenefitoflong-termpricecertainty72.OneintervieweesuggestedthatthiswasparticularlytrueforcorporationswithhighelectricitydemandsuchastheICTsector(e.g.,Amazon,Google,Microsoft),andthatlargedatacentreshavebeenattheforefrontofcorporaterenewableenergyprocurement,primarilyviaprivatewireandvirtualPPAs(Figure4)73.ItisnowpossibleforaPPAtocreatecostsavingsfromyearone.•CorporateSocialResponsibility(CSR):Aspublicenvironmentalconcernsgrow,consumersarelookingformoresociallyconsciousbusinesses.Onsitegenerationofferscorporatestheopportunitytoenhancetheirbrandreputationbyshowcasingtheircommitmenttoreducingenvironmentalimpact.Intheirmostrecentannualreport,RE100recordedagradualshiftfromunbundledEACsandtariff-basedrenewableenergyprocurementtoPPAs,whichareseenasmorerobustandofferadditionality74.Figure4.CumulativerenewableenergycorporatePPAsbysectorinEurope(MW;WindEurope,2020)71CCC(2020)Ibid.72IEA(2021)Renewables2021:Analysisandforecastto202673WindEurope(2021).Ibid.74RE100(2022a).Ibid.https://www.there100.org/stepping-re100-gathers-speed-challenging-marketsICT34%Heavyindustry30%Transport8%Pharmaceuticals8%Consumergoods5%Telecoms3%Retail2%Others10%26KeyenablementpoliciesOverallpolicyframeworkforclimateactionandrenewablesTheUKenergymarkethasbeencharacterisedbyearlyliberalisationandastrongcommitmenttotacklingclimatechange.TheClimateChangeAct2008wasground-breakinglegislationthatsettheframeworkandalegalobligationtoreducegreenhousegasemissionsintheUK.Five-yearCarbonBudgets,introducedbytheClimateChangeActanddeterminedbytheClimateChangeCommittee,settheUK’spathtodecarbonisation.AsignificantandevolvingbodyoffurtherlegislationhasprovidedcontinuousreinforcementoftheUKgovernment’scommitmenttoaddressingclimatechange.TheUKgovernmenthasatargettoreach100%renewableelectricitygenerationby2035.In2020renewableelectricityaccountedfor43.1%ofelectricitygenerated75.Policiestoincreasetheproportionofrenewableenergyinthegridandreducecostshavebeenacriticalfactorinincentivisingtheirtake-upbycorporates.Inadditiontoearly-stageR&Dsupport,theUKgovernmenthasusedmarket-pullpoliciestoincentiviseinvestmentinrenewablesandcostreduction.ThecornerstonepolicythroughwhichthishasbeenachievedistheRenewablesObligationandContractsforDifference.Policiessupportingon-sitegenerationAswellassettinganoverallpolicyframeworktodecarbonisetheenergysystemandsupportlarge-scalerenewablesfeedingintothegrid,theUKgovernmentalsobroughtforwardpoliciestosupportsmall-scalegenerationbycorporatesandbridgethecostgapbetweenfossilfuelsandrenewables.Non-DomesticRenewableHeatIncentive(RHI)SchemeEstablishedin2011,thenon-domesticRHIschemewasdesignedtoincentivisetheuseofrenewableheatinthenon-domesticsector.Itallowedbusinesses,thepublicsectorandNGOstoclaimquarterlypayments,basedontheamountofheattheygeneratedovera20-yearperiod.ItclosedtonewapplicantsinMarch2021.Becauseofthelocalcharacterofheat,itsupportedbusinessestoinstalltheirownrenewableheatgenerationtechnologies,althoughheatnetworksfedfromrenewablesourceswerealsoeligible.Duringthistime,NorthernIrelandbecamethesubjectofsignificantcontroversyasitbecameapparentthattherewasnorequirementfortheheatgeneratedtobeused.Thismeantthatitwaspossibletoproducerenewableheat,e.g.,byburningbiomass,andclaimingtheRHIwithoutthatheateverbeingused.Itwasthereforeknownasthe‘cashforash’scandal.CommercialFeed-inTariff(FiT)ThecommercialFiTwaslaunchedin2010andclosedtonewentrantsin2019.Itincludedsolarelectricity(PV),windturbines,hydroelectricity,anaerobicdigesters,andmicrocombinedheatandpower(CHP)generatingupto5MW.Itwassplitintoamicrogenerationscheme,forinstallationsupto50kW,andaschemeforlargeinstallationsover50kWandupto5MW.SmartExportGuarantee(SEG)75UKBEIS(2021).UKEnergyinBrief2021.27TheUKgovernmentintroducedtheSEGin2020toensurethatrenewableelectricitygeneratorscouldbepaidforelectricitythattheyexporttothegridfollowingtheclosureoftheFiT.EligibletechnologiesaresolarPV,onshorewind,anaerobicdigestion,andhydroupto5MW,andmicro-CHPupto50kW.Licencedenergycompanieswithover150,000customersareobligedtoofferaSEGtarifftothosesmall-scaleenergygenerators.RegulationofPPAsPrivatewirePPAsTheUKregulatoryframeworkdifferentiatesbetweenutility-scaleanddistributedlevelgeneration,simplifyingproceduresandreducingcostsforsmall-scaledistributedgeneration:•Developersarerequiredtosubmitapplicationsforinstallationsoflessthan50MW(or100MWforoffshorewind)totherelevantlocalauthority76.•Electricitylinesabovegroundof132kVarenormallysubjecttothePlanningAct2008andrequiredevelopmentconsent,butlinesareexemptiftheyareunder2kmlongorentirelywithinthepremisesofthepersonresponsiblefortheirconstruction77.•TheElectricityAct1989requiresconsentfromtheSecretaryofStatetoconstructanelectricitylineunlessitisunder20kVandwillsupplyasingleconsumer78.Inadditiontothepoliciesdescribedabove,effectiveconnection,permittingandtransmissionpoliciesarecriticalinfacilitatingdecentralisedgeneration,includingbycorporates79.SleevedPPAsTheElectricityMarketReformwithintheEnergyAct2013(Chapter6)establishedUK’spowerpurchaseagreementschemetofacilitateinvestmentinelectricitygenerationandenableaccesstoelectricitymarkets.Itallowslicencedsupplierstopurchaseelectricitygeneratedbyindependent(renewable)energygeneratorsatadiscounttothemarketrate80.TheOfftakerofLastResort(OLR)schemeisdesignedtogivegeneratorsconfidencebyprovidingaguaranteedroutetomarketshouldthePPAfail81.VirtualPPAsThereisnospecificpolicyorlegislationthatsupportsorincentivisesvirtualPPAs.Therearenogeographicrestrictionsonwheretheenergyisgeneratedand,intheory,cross-borderPPAsarepossible.However,cross-borderPPAsarenotwidelyinuse,partlyduetotheriskarisingfromapotentialmismatchbetweenenergypricesinthejurisdictionwherethegeneratorislocatedandwherethebuyerislocated82.76TownandCountryPlanningAct(1990).TownandCountryPlanningAct1990(legislation.gov.uk)77PlanningAct(2008).PlanningAct2008(legislation.gov.uk)78ElectricityAct(1989).ElectricityAct1989(legislation.gov.uk)79IRENA(2018).CorporateSourcingofRenewableEnergy:MarketandIndustryTrends80EnergyAct(2013).EnergyAct2013(legislation.gov.uk)81UKGovernment(2015b).PowerPurchaseAgreementscheme:OfftakerofLastResort82RE-Source(2020).Ibid.28PoliciesoncertificationofrenewablesThefirstcertificationschemeintheUKwasintroducedthroughtheClimateChangeLevy(CCL)in2001.TheCCLwasataxonUKbusinesses’energybills,wherebusinessesusingrenewablesourcescouldbenefitfromanexemption.OFGEM,theUKenergyregulator,establishedtheRenewablesandCHPRegisterwhererenewableenergygeneratorsreportedtheirMWhoutput,inreturnforaLevyExemptionCertificate(LEC)whichwereallocatedper1MWhproduced.GeneratorscouldthensellLECstotheirpowerpurchaser,whowoulduseLECsasevidenceforwhytheircustomersshouldbeexemptfromthetax83.BecausepowerpurchaserswerebuyingLECsdirectlyfromtheirenergygenerator,theLECswere‘bundled’andconsideredtodrivegreateradditionalitywithintheUKrenewablesmarket,comparedtothesubsequentREGOscheme84.TheissuingofLECsendedin201585.From2009,renewableenergyintheUKwascertifiedthroughEACsknownasREGOs,acertificateoforigin,guaranteeingtothebuyerthattheenergycertifiedwasproducedfromarenewablesource.OneREGOequatesto1MWhofenergygenerated.REGOswereimplementedtotrackrenewableenergyproductionandprovideinformationabouttheproportionofelectricitysuppliers’sourcefromrenewablegeneration.OFGEMoverseeREGOsthroughtheRenewablesandCHPRegister,whererenewableenergygeneratorsreporttheirMWhoutputinexchangeforREGOs.GeneratorsarethenabletosellbundledorunbundledREGOstosupplierswhichunderpingreentariffproducts,requiringanannualFuelMixDisclosure(FMD).OFGEMauditssuppliers’FMDandpenalisesnon-compliance86.BecausetheavailabilityofrenewablesintheUKsystemismorethanenoughtomeetdemand,thereisnoscarcityofREGOsinthemarket,whichhaskeptpriceslow.ThishasfacilitatedthegrowthingreentariffsintheUK,whichhavebeenofferedtoconsumersatcompetitiverateswithnon-greentariffs.DespitetheincreasingdemandforgreentariffsandREGOs,REGOshavebecriticisedforlackingadditionality,largelyduetotheirabilitytobe‘unbundled’fromtherenewableenergyasset.CurrentUKregulatorydevelopmentsTheUKTargetedChargingReview87createsasystemwhereeveryonepaystowardsthenetwork.Thishasremovedpartofthecostincentivetogenerateelectricitybehind-the-meter.However,thegovernmentisseekingtoaddressthisissuethroughanupcomingpolicyonnegotiatingconnectioncosts.From2023,costswillbeagreedthroughnegotiationbetweentheconnectingpartyandthesystemoperator,whowilldefineacostthatreflectstheembeddedflexibilityatthatconnection,e.g.,owngeneration,batteryorotherstorage,abilitytoreducedemand.Thiswillcreateanewformofincentivetogenerateelectricitybehind-the-meter.83Ofgem(2015a).ClimateChangeLevy(CCL)ExemptionforRenewablesandRenewableEnergyGuaranteesofOrigin(REGO)schemesfrequentlyaskedquestions84GoodEnergy(2020a).Ibid.85Ofgem(2015b).ClimateChangeLevyexemptionremovedFAQs86In2020,Ofgemfoundthat20suppliersreportedtohavesuppliedatotalof2,151,820MWhmoreelectricityfromrenewablesourcesthanwassupportedbythenumberofclaimedREGOs.Asaresult,18suppliersagreedtopayatotalof£90,000intotheEnergyIndustryVoluntaryRedressScheme(VRF).(Ofgem(2021)Link)87Ofgem(2019).TargetedChargingReview:DecisionandImpactAssessment29KeypolicyimpactsAconsistentpolicycommitment,includingearly-stageR&Dsupportfollowedbymarket-pullpolicies,hasdrivendowncostandmaderenewablesacompetitivechoiceforcorporatesAconsistentpolicycommitmenttorenewables,combinedwithspecifickeypolicies,hassentastrongmarketsignalthathasdriventhedevelopmentofrenewablesintheUK.Renewabletechnologieshaveseensignificantcostreduction,partlyasaresultofmarket-pullpoliciessuchastheRenewablesObligationandContractsforDifference,particularlyinoffshorewind.Thishasresultedintheavailabilityofcost-competitiverenewablesforUKcorporates,whetherthroughon-sitegenerationorthroughprivatewireorotherPPAswithoffsitegenerators.CorporatePPAs(virtualorphysical)withoffshorewindarecurrentlyinnegotiationandrepresentthefinalmoveawayfromsubsidyintheUK;costsarelowenoughanddemandforgreenenergyisgreatenoughthatcorporateswillbuyintoPPAswithdeveloperstoguaranteeofftakeonceawindfarmcomesonline.Specificpoliciesincentivisedcorporatestoinvestinon-siterenewableheatandelectricity,bridgingthecostgapbetweenfossilfuelsandrenewablesThenon-domesticRHIandcommercialFiTsubsidisedtheinstallationofrenewableheatandelectricitygenerationonsite.Thesesubsidyschemesbridgedthecostgapbetweenfossilfuelsandrenewablesandencouragedcorporatestothinkaboutgeneratingtheirownrenewableenergyonsiteforthefirsttime.Buildingontheexperiencegainedthroughthosesubsidyregimes,theUKnowhasawell-developedmarketforonsitedecentralisedrenewableswithexperiencedinstallersandcost-effectivetechnologies.WhileonsitegenerationwilloftenbeasoundcommercialdecisionforUKcorporates,protectingcompaniesfromenergypricerisesandvolatilityandprovidingarapidpaybackandattractivereturns,itshouldbenotedthatnotallcorporateshavethephysicalpotential,internalskillsorcapacitytocommissionon-sitegenerationprojects.CertificationhistoricallysupportedadditionalitybutthatlinkwaslostwiththeremovaloftheCCLCertificationofrenewablesintheUKisrobust,givingbuyersconfidenceinthescheme,buttheadditionalitycreatedbytheCCLandLECsasdescribedabove,incentivisingnewgenerationbyincentivisingprocurementbycorporates,waslostwiththetransitiontogreentariffsbackedbylow-costandabundantREGOs.Asdescribedabove,theunbundlingofREGOsmeanthatanenergysuppliercanofferagreentariff,backedbythelow-costtradedREGOstheyhavepurchased,withoutmakinganydirectinvestmentinrenewables.ArenewableenergygeneratorcanclaimREGOsforalltheenergytheygeneratebutwillnotnecessarilyhaveauseforallthoseREGOstoprovetherenewableoriginoftheenergy.TheREGOssurplustothegenerator’srequirementscanthenbesoldontosupplierstobackagreentariff.Thishasledtosignificantconcernsoverthe‘greenwashing’ofgreentariffsintheUK,whereconsumersmaythinktheyaresupportingrenewableenergygeneration,butcouldinfactbebuyingenergyfromasupplierusingREGOstobacktheirgreentariffsratherthanbuyingenergyfromrenewablesources.In2021theUKgovernmenthasannouncedareviewintothemarketingofgreentariffstodeterminewhetherreformisnecessary88.88UKGovernment(2021).Governmenttotightenrulestostop'greenwashing'ofelectricitytariffs30VirtualPPAs,areattractivetocorporates,havethepotentialtodriveinvestmentinnewrenewablesgeneration,andarenotdependentonpolicyinterventionintheUKVirtualPPAsareattractivetobothageneratorandaconsumerastheygivebothpartiescertaintyontheircost/revenuethroughtheagreementofastrikeprice.PoliciestocommercialiseanddrivedownthecostofrenewablesintheUK,suchastheRO,CfDs,non-domesticRHIandcommercialFiT,havehadapositiveimpactontheaffordabilityofPPAs.VirtualPPAsgiveflexibilityoverthesitingofgenerationassetsandend-users.Furthermore,theydonotrequireinterventionorsubsidybygovernmentandcreateadditionalitybyincentivisingtheconstructionofnewrenewableenergycapacity.Duetothisgreateradditionality,theycreateandaclearlinkwithaphysicalasset,theyalsooffercorporatesgreaterenvironmentalcredibilitythanagreentariff.VirtualPPAsarenotyetcommonintheUK.GeneratorsachievedpricecertaintythroughtheROandCfDs,andcorporateswerenotalwaysasmotivatedbygreencredentialsandhedgingenergypricesastheyarenow.ThecurrentlowcostofrenewablesintheUK,combinedwithgreaterincentivesforcorporatestolockinasourceofrenewableenergy,meanthatvirtualPPAsarelikelytobecomemorecommonintheUKinthenear-term.IntegrationcostswerenotaddressedbypoliciessuchasCfDsandtheRO;policymakersdeveloping,orreformingincentiveregimesshouldtakeaccountofstorageintegrationintheirdesignNoneofthecurrentorhistoricUKpoliciesdescribedaboveaddressessystemintegrationcosts.NewandexistingrenewablescapacityintheUKneedstoconsiderpotentialco-locationwithstorageinordertofacilitatethecontinuedconnectionofintermittentrenewablestothegrid.ThereiscurrentlynoclarityintheUKonwhathappensifaninstallationbenefittingfromanexistingROorCfDwantstointegratestoragewiththeirgenerationasset.Anynewincentivemechanismunderconsiderationshouldgiveclarityontheintegrationofstorageinordertoapportionriskappropriately,andtoenableretrospectiveadditionofstoragetoexistinginstallations.5.RecommendationsforsupportingcorporateREprocurementinChinaThissectionintroducesseveralinitialpolicyrecommendationsforsupportingandacceleratingcorporateREprocurementinChina.Someoftheserecommendationscanbeimplementedintheshort-term,whileotherswillfeedintothewiderpowermarketreformandrequirefurtherdiscussionorpilotingbeforetheycanbeintroducedaspoliciesormechanisms.Intheshort-term,priorityshouldbegiventoimprovingthemarketaccessibilityandpolicytransparencyofexistingREprocurementoptions,especiallyPPAs.Itisalsoveryimportanttolinkthedifferentmechanismssuchasgreenelectricitytransactions,GECs,RPSandthecarbonemissionstradingmarket,toavoiddoublecountingrisks.Inthemediumandlong-term,withthedevelopmentofChina’snationalpowermarket,furtherrenewableprocurementoptionscanbeexplored,suchasthevirtualPPA.Thecostofrenewablesshouldalsobefurtherbroughtdownthroughtechnologyinnovationandreductionofnon-technicalcosts.31ImproveandrefinethetransactionrulesandprocesstoincreasetheaccessibilityofgreenelectricityWhiletherehasbeensubstantialprogressongreenelectricitytransactionpolicyinthepasthalfyearwiththelaunchofthegreenpowertradepilotprogramandreleaseoftransactionrulesinthesouthernregion,thecurrentpoliciesandrulesstillneedtobeexpandedonfurtherinordertoimproveaccessibilityandreducethecomplexityoftransactions.Firstly,detailedpoliciesandtransactionrulesforgreenelectricitytransactionsarerequiredfortheregionswhichoperateundertheChinaStateGrid,andtheseneedtobereleasedassoonaspossible.Thoughsomeprovinceshavereleasedtheirowntransactionrules,theyoftenvarybetweenprovinces.Itisrecommendedtokeepthetransactionrulesasconsistentaspossible.Thiswill,especiallybenefitcompanieswithdemandforREprocurementoperatinginmultipleprovinces.Secondly,thetransactionsshouldbeprogressedfrompilotphasetonormaloperationassoonaspossibleandheldonaregularbasis.Thiscouldhelpestablishastableexpectationofthemarketandencouragetransactionstobescaledup.Thirdly,transactionrulesneedtobeclearlyexplainedanddisclosed,makingiteasyformarketparticipantstounderstandandfollow.Itisalsosuggestedthattrainingsareprovidedforretailersandcorporateswithgreenelectricityprocurementdemand.Tofurtherincreasethesupplyandavailability,expandingthesourcesofrenewableenergyinvolvedinthemarketisrecommended.Besidesutility-levelsolarandonshorewindprojectswhicharemajorsuppliersofthePPAmarket,newsubsidy-freeprojectssuchasoffshorewindanddistributedsolarprojects,biomassandhydrogen,shouldalsobegrantedqualificationtoparticipateingreenelectricitytransactionsinthenearfuture.Promoteinter-provincialtransactionsandencouragelong-termPPAsTransactionmechanismsforinter-provincialgreenelectricityprocurementshouldbedevelopedandimplemented.ConsideringthestructuralinequalityofenergydemandandrenewableenergyresourcesacrossdifferentregionsinChina,inter-provincialPPAswouldhelptobalancethedemandandsupplyofrenewableenergyelectricity,increasingtheaccessibilityofrenewableenergyforbuyersineastandsoutheastChinaandreducingthecurtailmentofREinnorthwestChina.Currently,inter-provincialPPAsareverylimitedinChinaandtransactionsusuallyonlyhappenbetweentheprovincialgridcompaniesindifferentprovincesinsteadofbetweencustomersandgenerators.Furthereffortsarerequiredtopromotethedevelopmentoftheinter-provincialPPAmechanism,includinghowtolinkthiswiththeintra-provincialmarketsandthespot-market.Itisalsorecommendedtoencouragelong-termgreenelectricityprocurementagreementstodriveREinvestmentfromthedemandside.IntheUK,PPAsaretypicallymulti-yearcontracts,whichprovideguaranteedrevenuestreamsandthuscertaintyofreturnsforinvestors.WhiletheGreenElectricityTradingPilotWorkPlanencourages5-10yearsPPAs,mostcontractsarecurrentlyonlyoneyear.Long-termagreementswouldhelpbothREbuyersandgeneratorstosecurelong-termtransactionvolumeandpricerangeagainstuncertainty,andthusprovidestabilitytothemarket.Itcanalsohelpsecurerevenuefornewprojectsinthenewzero-subsidyera.CoordinatetheGECmarket,greenelectricitytransactionmarket,RPSsystemandcarbonmarkettoavoiddoublecountingItishighlyrecommendedtousetheGECastheuniquecertificateforgreenelectricityconsumptioninChinaandimprovetheaccountingsystemtocrediblytrackthegreenattributesofrenewableelectricity.Thepowerexchangecentreswhoareresponsiblefororganisinggreenelectricitytransactionsshould32coordinatewiththeissuerofGECs(NationalInformationManagementCentreforRenewableEnergy)toensurethattheGECsaretransferredtotheconsumersandbundledwiththegreenelectricitytheyhavepurchased.Indoingso,GECscanbetrackedastheuniquecertificateforgreenelectricitytransactionsacrossdifferentprovincesandregions.ThegovernmentshouldalsobecarefulaboutthedoublecountingriskbetweenthevoluntaryGECmarketandthemandatorymarketunderRPS.Moredetailedrulesoranaccountingsystemareneeded.Inaddition,furthercoordinationisrequiredduringtheimplementationprocess.Withregardstothecarbonmarket,theoverlapofGECandCCERalsoneedstoberesolved.Ideally,thiswouldmeanthatrenewableprojectswithGECscannotapplyforCCER.Thiswillavoiddoublecountingthegreenattributesofrenewableenergy.Inadditiontothedomesticmarketandmechanisms,thereareinternationalEACssuchasiRECorAPX-TIGRwhicharepurchasedbycorporateslookingtoachievetheirrenewableconsumptiontargetsinChina.ItneedstobeclearthatthegreenelectricityassociatedwithiRECorAPX-TIGRshouldnotbeeligibleforGECs,sotheriskofdoublecountingcanbemitigated.ThesuggestionsmadeabovewillimprovethecredibilityofGECsandmakeitfullyrecognisedbytheRE100,CDPandotherinternationalreportingsystems,thus,increasingthedemandforGECs.ExploringthefeasibilityofvirtualPPAsinthemediumtolong-termInthemediumtolong-term,itisrecommendedvirtualPPAsshouldbeincorporatedintothecurrentPPAscheme.In2021,Chinaannouncedsixprovincesandcitiesasthesecondgroupofelectricityspotmarketpilots89.Withthefirsteightpilotsstartingin2017,therearenowatotalof14spotmarketpilotsinChina90.Insomepilotschemes,renewableenergycanbetradedonthespotmarkets.ArecentlyreleasedInter-ProvincialSpotMarketTradingRules(Pilot)hasexpandedthegeographicalscopeofinter-provincialtransactionsandencouragedcorporateswithREdemandandREgeneratorstoparticipateintheinter-provincialelectricityspotmarket91.ThespotmarketdevelopmentwithrenewablesinvolvedmightenablevirtualPPAsinthefuture92.SinceavirtualPPAlocksinthepriceofREforbuyersandsecuresanincomestreamforsellersforusually10-20years,bothpartiescanhedgeagainstmarketuncertainty.Furtherincentivisecorporates’demandforgreenpowertoacceleraterenewableenergyinvestmentanddevelopmentAlthoughwehaveseenclearpolicydirectionthatthegovernmentwillpromotegreenelectricityconsumption,detailedactionplansandguidanceneedtobereleasedassoonaspossible.Forexample,themethodologyforGHGaccountingandreportingforETSshouldberevisedandupdatedtoremovetheemissionsreductionfromgreenelectricityconsumptionandtoreflectthegreenattributesofrenewableelectricityintheETS.Also,itisrecommendedtodevelopincentivepoliciestoencouragecorporates,especiallylargecompanies,topurchasegreenpower.89Sina(2021).两部委发文：电力现货市场试点增加6个！新能源发电量10%纳入市场竞争！现货市场_新浪财经_新浪网(sina.com.cn)90ChinaGovernment(2017).【关于开展电力现货市场建设试点工作的通知(发改办能源〔2017〕1453号)】-国家发展和改革委员会(ndrc.gov.cn)91StateGrid(2021).国家电网-国网四川省电力公司(sgcc.com.cn)92RMI(2019).Ibid.33Continuetobringdownthecostofrenewableenergythroughsupportingtechnologyinnovationandreducingnon-technicalcostsBasedonthepolicyreviewofrenewableenergydevelopmentinChinaandtheUK,webelievethatcostreductioniskey.Currently,theutility-levelsolarandonshorewindprojectsarealmostcomparablewiththermalpowerinChina.WiththefurtherreductionofLCOEofrenewables,weexpectcorporateswillbefurtherincentivisedtoprocureit,whileinvestorswillbeattractedbyhigherrevenues.IncreasemarketaccessibilityandpolicytransparencyforREprocurement,especiallyforinternationalcompaniesFinally,marketaccessibilityandpolicytransparencyshouldbeimprovedtobuildinternationalcompanies’confidenceinachievingtheirrenewableconsumptioncommitmentsfortheiroperationsinChina.Ifcompaniescanmeettheirinternationalobligations,thiswillhelpunlockpotentialforeigninvestmentinChina.Tofacilitatethis,transactionrulesshouldberefinedandclearlyexplainedassuggestedabove,withrelatedtransactioninformationupdatessuchasminimumtradingvolumesandqualifyingrequirementsforbuyersregularlyandpubliclyannounced.Additionally,thetransferofgreenattributesofrenewablesshouldbetrackedanddisclosedtransparentlytoalignwithinternationalstandardstohelpdevelopinternationalrecognition,especiallyforGECs.Finally,toboosttheparticipationofbuyersinthemarket,regularpressconferencesandtrainingsessionsshouldbeorganisedtosupportcompaniesindealingwithanychallengesduringtheprocurementprocess.346.ListofreferencesBaringa(2021).RenewabletariffsintheUK:whatmakesatariffgreen?Bird,L.etal.(2017).PoliciesforEnablingCorporateSourcingofRenewableEnergyInternationally:A21stCenturyPowerPartnershipReport,NationalRenewableEnergyLaboratory,Golden,COBritishChamberofCommerce(2021).BritishBusinessinChina:PositionPaperCCC(2020).CorporateProcurementofRenewableEnergy:ImplicationsandConsiderationsCDCC(2021).2021年中国数据中心市场报告ChinaGovernment(2017).【关于开展电力现货市场建设试点工作的通知(发改办能源〔2017〕1453号)】-国家发展和改革委员会(ndrc.gov.cn)ChinaGovernment(2021a).中共中央国务院关于完整准确全面贯彻新发展理念做好碳达峰碳中和工作的意见_中央有关文件_中国政府网(www.gov.cn)ChinaGovernment(2021b).国家能源局征求意见：2021-2030年各省光伏、风电消纳责任目标(yq.gov.cn)ChinaGovernment(2021c).国家发展改革委国家能源局关于2021年可再生能源电力消纳责任权重及有关事项的通知_电力_中国政府网(www.gov.cn)ChinaGovernment(2022a).关于印发《“十四五”现代能源体系规划》的通知(发改能源〔2022〕210号)】-国家发展和改革委员会(ndrc.gov.cn)ChinaGovernment(2022b).国家发展改革委国家能源局关于加快建设全国统一电力市场体系的指导意见ChinaGovernment(2022c).国家发展改革委国家能源局关于完善能源绿色低碳转型体制机制和政策措施的意见_节能与资源综合利用_中国政府网(www.gov.cn)ChinaGovernment(2022d).2022年李克强总理作政府工作报告_中国政府网(www.gov.cn)ChinaGovernment(2022e).国务院关于印发“十四五”节能减排综合工作方案的通知（国发〔2021〕33号）_政府信息公开专栏(www.gov.cn)ChinaNationalEnergyAdministration(2021).国家能源局关于印发能源领域深化“放管服”改革优化营商环境实施意见的通知国能发法改〔2021〕63号-国家能源局网站(nea.gov.cn)CrownCommercialService(n.d.).IntroductiontoPowerPurchaseAgreementsCRS(2019).AcceleratingCorporateRenewableEnergyEngagementinChinaElectricityAct(1989).ElectricityAct1989(legislation.gov.uk)EnergyAct(2013).EnergyAct2013(legislation.gov.uk)GoodEnergy(2020a).RenewableEnergyTariffs:TheProblemofGreenwashingGoodEnergy(2020b).RenewableenergyinEurope:AnanalysisofhowUKenergysuppliersuseGuaranteesofOrigincertificatesGreenenergy.org.cn(2022a).StatisticsGreenenergy.org.cn(2022b).HonourList35Greenpeace(2021a).中国数字基建的脱碳之路：数据中心与5G减碳潜力与挑战（2020-2035）Greenpeace(2021b).RacetoGreen:ScoringTechCompaniesfromChina,JapanandSouthKoreaontheirClimateActionandRenewableEnergyUseGreenpeaceandNorthChinaElectricPowerUniversity(2020).点亮绿色云端中国数据中心能耗与可再生能源使用潜力研究HundtandJahnel(2021).Decarbonisation&PowerPurchaseAgreements–AneconomicanalysisoftheregulatorystatusquoinChinaIEA(2021).Renewables2021:Analysisandforecastto2026Integral(2021).UnveilingRE100Roadmap:TheWayto100%RenewableElectricityinChinaIRECStandard(2021).ChangeinissuancecriteriaforChinafollowingConsultationIRENA(2018).CorporateSourcingofRenewableEnergy:MarketandIndustryTrendsJD.com(2020).Environmental,SocialandGovernanceReportNDRC(2016).关于调整光伏发电陆上风电标杆上网电价的通知(发改价格〔2016〕2729号)NDRC(2018).关于2018年光伏发电有关事项的通知(发改能源〔2018〕823号)NDRC(2019).关于完善光伏发电上网电价机制有关问题的通知(发改价格〔2019〕761号)NDRC(2020).关于2020年光伏发电上网电价政策有关事项的通知(发改价格〔2020〕511号)OffshoreWIND.biz(2021).AmazonRevealsOffshoreWindPlayinUKOffshoreWindOfgem(2015a).ClimateChangeLevy(CCL)ExemptionforRenewablesandRenewableEnergyGuaranteesofOrigin(REGO)schemesfrequentlyaskedquestionsOfgem(2015b).ClimateChangeLevyexemptionremovedFAQsOfgem(2019).TargetedChargingReview:DecisionandImpactAssessmentPlanningAct(2008).PlanningAct2008(legislation.gov.uk)QQNews(2021).我国首单平价绿证交易完成RE-Source(2020).IntroductiontoCorporateSourcingofRenewableElectricityinEuropeRE100(2020).GreenElectricityCertificate(GECs)ofChinaRE100(2022a).Steppingup:RE100gathersspeedinchallengingmarketsRE100(2022b).TechnicalGuidanceRMI(2019).StateofTheMarket2019:CorporateRenewableProcurementinChinaRMI(2022).企业绿色电力采购机制中国市场年度报告：2021年进展、分析与展望SinaFinance(2016).苹果扩张在中国新能源布局：入股金风科技旗下4家新能源公司Sina(2021).两部委发文：电力现货市场试点增加6个！新能源发电量10%纳入市场竞争！现货市场_新浪财经_新浪网(sina.com.cn)36SohuNews(2021).到2025年底，将达到分布式12G到2025年底，将达到分布式12GW、集中式14GW！江苏省“十四五”可再生能源规划征求意见稿出炉W、集中式14GW！江苏省“十四五”可再生能源规划征求意见稿出炉SBTi(2022).CompaniesTakingActionSolarbe(2021).2021年新能源上网政策全面解读：不再补贴，实行平价上网StateG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