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Pledged loans based on carbon emission rights are emerging quietly, with many chemical companies successfully pledging their carbon allowances! Author/Source: Sinopec. Date: 2021-08-31. Clicks: 26. On August 27, Hubei Sanning Chemical Co., Ltd. successfully obtained a loan of 10 million yuan from the Hubei branch of the Agricultural Bank of China by using its excess carbon emission rights as collateral. It is understood that carbon emission rights pledge loans are loans issued to eligible market entities, with carbon emission rights quotas used as collateral. In July of this year, the national carbon emission trading market was officially launched for trading; \"carbon assets\" were given market value and liquidity, and such assets in this market can be used as collateral for loans. Not long before that, Jiangsu Province’s first loan secured by carbon emission allowances was also granted to a chemical enterprise. On August 13, Taixing Xinpǔ Chemical Co., Ltd. applied to Taixing Agricultural and Commercial Bank for a pledged loan of 5 million yuan, using 110,000 tons of carbon emission quotas as collateral. The loan was registered and made public through the Unified Registration and Publicity System for Tangible Property Financing, at an interest rate of 3.8%; this arrangement helped the company save approximately 200,000 yuan in costs related to evaluation and guarantees. It is understood that Taixing Xinpǔ Chemical Co., Ltd. is located in the **-level green industrial park – Taixing Economic Development Zone in Jiangsu Province. As a leading enterprise in the region, it is currently utilizing advanced global manufacturing technologies to build a \"green factory\" that is environmentally friendly, safe, and energy-efficient, with the first ethane-to-ethylene production facility as its core component. The company owns its own power plant and was among the first enterprises in the country to obtain carbon emission allowances for trading. Apart from Hubei and Jiangsu provinces, pledge loans based on carbon emission quotas have been implemented in many other regions of China. In Tianjin, Dagu Chemical Co., Ltd. has expressed a business need to leverage carbon assets for financing purposes. The company is one of the first pilot enterprises in Tianjin to engage in carbon emission trading. This year, in order to actively meet the requirements for green production, it has increased its investments in energy conservation and emission reduction efforts, thereby improving its low-carbon production capabilities. After meeting its annual quota obligations, it still holds around 400,000 tons of transferable carbon allowances, which are worth approximately 10 million yuan based on the average annual price. Recently, the Tianjin Branch of Industrial and Commercial Bank of China proactively introduced financial services related to carbon assets to enterprises. It also innovated the management model for carbon asset collateral. Through extensive coordination, it devised a pledge financing plan for carbon assets for an enterprise within a week and completed the credit approval process. Utilizing carbon allowances as a credit enhancement measure, the bank extended a working capital loan worth 10 million yuan to the enterprise—an amount equivalent to the value of its carbon assets. This move helped the enterprise make better use of its carbon assets, broaden its financing channels, and facilitate its green transformation and development. In Zhejiang, the Ruian branch of the Industrial and Commercial Bank of China arranged a loan of 5 million yuan for Zhejiang Huafeng New Materials Co., Ltd., with carbon emission quota rights serving as the collateral for this loan. It is reported that Ruian Huafeng Thermal Power Co., Ltd., a affiliated company of Zhejiang Huafeng New Materials Co., Ltd., holds over 160,000 tons of carbon emission allowances. This is also the first pledge loan for carbon emission rights quotas issued in Wenzhou.