China Provides Financial Incentives for Energy-Saving Technological Transformation

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By Yao Lu

Jul. 27 – To accelerate the application of advanced energy-saving technologies and increase efficiency in energy utilization, China’s National Development and Reform Commission and Ministry of Finance jointly issued the “Circular on Preparation for Notification of Financial Incentive Projects Related to Energy-Saving Technological Transformation of the Year 2013 (fagaibanhuanzi [2012] No.1972, hereinafter referred to as ‘Circular’)” on July 17, which outlines projects qualified for financial incentive funds, as well as the application materials and submission period to apply for such funds.

As forwarded by the Circular, the government mainly supports projects relating to energy-saving technological transformation, namely:

  • Coal boiler (furnace) transformation
  • Waste heat and waste pressure utilization
  • Conservative and alternative oil (only conservative oil transformation project included)
  • Energy-saving for electrical machine system
  • Energy system optimization

As required by the Circular, project-undertaking enterprises shall possess complete energy measurement, statistic and management systems. All projects shall be handled in accordance with national industrial policies and be completed by the end of 2014. Moreover, after the initial application, such projects should be able to save at least 5,000 tons of standard coal each year.

According to the Circular, support is not available to such projects under the following circumstances:

  • The project applicant suffers from poor operating situations and low economic efficiency
  • The main equipment the project is attached to is not within the enterprise list released by the government
  • The main equipment the project is attached to does not meet national industrial policies, or has been listed under catalogues that are expressly required by the government to be eliminated
  • The main aim of the project is to increase production capacity, or fall into the catalogues of energy-saving product manufacturing, energy-saving technology development and energy-saving management
  • The project is related to the development and utilization of new energy
  • The project utilizes high-quality energy, low-quality energy, and biological energy to replace coal or blended coal
  • The project should be concurrently constructed to support the main projects
  • The project’s accounts for energy purchased, produced and consumed do not meet the stipulated standard
  • Renovation projects that make use of waste heat, waste energy and waste gas
  • The project (or main parts of the project) has been completed before September 30, 2012
  • The project has already received support from the National Development and Reform Commission or other departments, or is a new project applied by an enterprise whose latest state-sponsored energy-saving project has not been completed yet

Application materials

For entities applying for the financial incentive fund, the following material shall be provided:

  1. Application reports of the financial incentive fund on energy-saving and emission reductions
  2. Electronic documents generated from the fund management system regarding the project of energy-saving technology transformation
  3. On-site audit reports
  4. Summary sheets of project applications through the region
  5. Documents related to examination and acceptance on completion for the latest state-sponsored energy-saving projects of the application entities

Submission deadline

The application materials for the projects of 2013 should be served according to the above requirements before November 20, 2012. The application materials for project settlement of previous years shall be served before September 30, 2012. Applications who miss this deadline will not be accepted.

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