funding sources for national zero-carbon parks

context: The first batch of 52 national zero-carbon industrial parks for construction in December 2025 was issued by the National Development and Reform Commission, the Ministry of Industry and Information Technology and the National Energy Administration. Zero-carbon parks and factories are set to become a major lever in promoting industrial decarbonisation and global competitiveness among PRC firms, particularly among export-oriented sectors. 

The current policy-based funding sources for national zero-carbon industrial parks include 

  • long-term special treasury bonds 
    • three core areas: Beautiful China initiative, future industry development, energy and power infrastructure upgrades 
    • support ratios
      • based on regional classification (east, central, western regions), central investment support ratios should not exceed 30, 60 and 80 percent of total project investment respectively
        • zero-carbon park projects in central and western regions receive priority support 
      • for energy and power facility equipment upgrading projects, total investment must be no less than C¥20 million, distribution network projects must reach C¥100 million 
        • subsidy standard is 15 percent of equipment investment 
    • advantages
      • large funding scale and long support cycle, suitable for major long-term infrastructure investments 
      • full-chain coverage from planning and tech R&D to implementation 
      • strong support for central and western regions
    • disadvantages
      • high requirements for application 
      • limited support for operational or business model innovation projects
      • strict application procedures with high requirements for pre-project planning 
  • central budget investment for energy conservation and carbon reduction 
    • focus on energy efficiency retrofits, clean energy substitution, circular economy development and zero-carbon demo projects 
    • support ratios 
      • energy efficiency, clean coal substitution, circular economy CO2 reduction, low/zero/negative carbon demo projects are all supported at 20 percent of total investment 
      • projects included in the national green low-carbon advanced tech demo list may receive up to 30 percent support 
      • for carbon peaking and neutrality capacity building projects, ratios are 60 percent (eastern), 70 percent (central) and 80 percent (western and northeast regions)
      • projects involving central government agencies are fully funded 
      • single project support generally capped at C¥100 million 
    • advantages
      • highly aligned with zero-carbon park development goals 
      • clear definition of support ratios and caps 
      • flexible coverage across retrofitting, construction, demo and capacity building 
    • disadvantages 
      • C¥100 million cap may be insufficient for ultra-large park transformation projects 
      • high requirements for quantified carbon reduction and energy efficiency outcomes 
      • some project types are limited to state-backed projects 
  • new policy-based financial instruments 
    • mainly support municipal, industrial park and energy infrastructure, helping to fill capital gaps 
    • support ratios 
      • typically cover up to 50 percent of required project capital, with ratios determined based on project type and regional conditions 
      • no cap on funding, with priority given to large-scale projects with significant social benefits 
    • advantages
      • addresses capital shortages in infrastructure projects
      • strong leverage effect to attract bank financing and private investment 
      • compatible with energy and municipal infrastructure needs of zero-carbon parks 
    • disadvantages 
      • primarily limited to capital supplementation; no support for operating expenses 
      • projects must be included in provincial-level or higher major project pipelines 
      • limited support for R&D or light-asset projects 

Each of these funding channels has distinct focuses, covering the entire lifecycle of zero-carbon park development (from planning and design, tech breakthroughs and infrastructure upgrading) to demonstration and implementation.