As the world works towards a more sustainable future and limit carbon emissions, nations, businesses and individuals are embracing renewable energy. Some of these initiatives include:
- RE100: Businesses pledge to use 100% renewable energy when they sign up for RE100
- Triple renewable energy by 2030: To meet global emission reduction targets, countries pledge at COP28 to triple renewable energy capacity to 11,000 TW by 2030
As a result, both demand for and supply of renewable energy have grown exponentially. According to the International Energy Agency, China will lead the way in renewables capacity over the coming years.
How is China Enabling Access to Renewable Energy?
China is enabling access to #renewable #energy in the following ways:
- Increasing renewable energy capacity – by 2030, China will have more than 50% of the world’s renewables.
- Establishing the Green Electricity Certificate (GEC) market
To recap, a GEC is China’s version of an Energy Attribute Certificate (EAC). Like other EACs, each GEC represents 1 MWh of renewable electricity.
From 2025 onwards, entities can only use the GEC to track renewable energy production and consumption in China. Renewable energy claims backed by I-REC(E) could only be used to verify renewable energy consumption up to the year ending 31 December 2024.
Why Should Businesses Use GECs?
As a global manufacturing and supply chain hub, carbon emissions by Chinese enterprises and global MNCs with operations in China are not insignificant. With renewable energy capacity increasing rapidly and the establishment of the GEC market, these businesses will be able to adopt clean energy using GECs to achieve the following objectives:
- Reduce carbon footprint: By procuring and retiring GECs, businesses will be able to claim use of zero or low-emissions energy, reducing their Scope 2 emissions
- Comply with global sustainability standards: RE100 recognises the GEC as a valid tool to address Scope 2 emissions; MNCs with operations in China may use the GEC to account for renewable energy use for their operations in China
- Comply with local laws: As mentioned in the previous blog, the GEC is the sole legal instrument to track renewable energy production and consumption in China. Using the GEC ensures business in China adhere to local regulations
- Enhance competitive edge: Through the use of GECs, enterprises, especially MNCs, may boost their sustainability credentials and appeal to environmentally-conscious customers
- Support renewable energy development in China: Entities can signal their support for clean energy development in China by purchasing GECs, potentially spurring more investment in renewables
- Create a greener future: When businesses use GECs, they demonstrate their desire to create a cleaner and greener environment for present and future generations
A Strong Case for GECs
For MNCs with operations in China to effectively decarbonise, it is essential to build a global renewable energy portfolio that includes GECs.
Entities have to use GECs to verify renewable energy claims and reduce Scope 2 emissions for the Chinese market.
In our next blog post, we will explore the credibility of GECs.
Contact us enquiry@redex.eco to find out more about GECs and how we can support your renewable energy journey in China.
Find out how we can support your renewable energy journey in China.
