RMI Releases Report On Zero-Carbon Investing in China

RMI and the Investment Association of China's report identifies seven key investment areas for China's zero-carbon transition.

BEIJING, March 30, 2021 /PRNewswire/ -- China's carbon-neutrality goal will activate the market and encourage more long-term value investors to focus on zero-carbon development and invest in zero-carbon assets, projects, and technologies. This is the subject of a new report by RMI China and the Investment Association of China, Zero-Carbon Investing: Opportunities from China's Carbon-Neutrality Goal.

This report identifies seven key investment areas for China's zero-carbon transition: resource recycling, energy efficiency, demand-side electrification, zero-carbon power generation, energy storage, hydrogen, and digitalization. The market size of these seven areas will reach nearly 15 trillion yuan (¥) (US$2.32 trillion) by 2050.

"Zero-carbon China will be the new direction of long-term value investment, thanks to the global trend of zero-carbon development and transition, as well as the Chinese government's increasingly clear strategic goal of zero carbon. These seven areas will also contribute 80% of China's total emissions reductions by 2050. Meanwhile, from 2020 to 2050, there will be about ¥70 trillion (US$10.8 trillion) in infrastructure investment leveraged directly or indirectly, and numerous new job opportunities to be created," said Chen Ji, principal at RMI and one of the key authors of the report.

These zero-carbon technologies are currently at different phases in terms of market expectations and industrial maturity. They therefore face different challenges and opportunities, which require different policy and market enablers to become more bankable. The report:

• Analyzes the trends and market sizes of innovative clean technologies in these seven areas
• Envisions a development pathway for these clean tech solutions
• Provides policy and investment recommendations for each area according to its development stage and role in the zero-carbon economy

"To achieve China's carbon-peaking and carbon-neutrality targets, the zero-carbon economy will be a high priority for investment in the next four decades. We believe that the insights from this research are able to deepen the market's understanding of the zero-carbon concept, raise awareness of green development, and set the tone to accelerate the energy transition in China," said Jie Zhang, vice president and secretary general of the Energy Investment Professional Committee of Investment Association of China (IAC).

"This paper sets out the zero-carbon vision and pathway through the lens of investment, and directs investment resources to zero-carbon projects, which is very valuable for China to achieve its ambitious and arduous goal of carbon neutrality," said Yaowei Sun, president of the Energy Investment Professional Committee of IAC.

"At the Two Sessions 2021 held earlier this month, the Chinese government re-emphasized the strategic importance of the carbon-neutrality goal in the government work report, which shows China's resolution and confidence to develop a zero-carbon economy. RMI will continue to collaborate with global partners to explore new investment opportunities in the zero-carbon sector and provide market-based solutions that can be scaled up for the implementation of carbon-neutrality goal," said Ting Li, regional managing director and chief representative in RMI Beijing office.

Considering that zero-carbon China is still at an early stage of development, the market is expecting more related policies and measures in the seven investment areas along with continuous improvement in the investment environment. We recommend that investors also strengthen their understanding of zero-carbon investment sectors and expand their capabilities in order to be fully prepared for these new opportunities and reap the value returns.