Saturday, February 5, 2011

China's Green Laws for Business

In 2008, China passed green legislation aimed at companies operating in China. The legislation had a major impact on Western firms who thought their carbon intensive operations could avoid government regulation by being based in China.

According to research from Carnegie Mellon University, a third of Chinese emissions are the direct result of the manufacture of products and services that are exported, primarily to Western markets.

China's laws and regulations support the government's climate change targets including reducing energy consumption per unit of GDP by 20 percent, doubling renewable energy capacity. These laws also helped China to succeed in their goal of cutting pollution levels 10 percent by 2010 compared to a 2005 baseline.

A range of Chinese regulations are designed to curb carbon emissions and promote adoption of clean technologies. These measures help China to develop a "recycling economy" that could maximize economic efficiency while minimizing energy consumption and emissions. Industrial and rural sectors are encouraged to make wider use of waste material.

Under the regulations, industries are required to introduce water-saving technologies and encouraged to switch to cleaner forms of energy, including renewables. Businesses and government departments are required to install renewable energy technologies in new buildings and develop their own plans for promoting energy efficiency and recycling.

Tax breaks have also been introduced on energy efficient and clean technologies, and a number of inefficient products have been banned. Companies and government departments that use prohibited products face fines of 50,000 yuan to 200,000 yuan (about $7,622.53 USD to $30,490.13 USD).

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