On March 14, 2022, the
MEE published on its website and social media platforms a circular criticizing
four MRV agencies for falsification of carbon emission’s MRV. The list includes Zhongtan Nengtou, SinoCarbon, Qingdao Xinuo New Energy, and Liaoning Dongmei Testing and Analysis Research Institute.
Accurate and reliable data is indispensable for the success of China’s emissions trading scheme (ETS) and ultimately the country’s decarbonization. The National Development and Reform Commission (NDRC) announced in its 2022 work program that the country will build a “science-based, reasonable, concise, well-adapted, uniform, and standard” system for measurement, reporting, and verification (MRV) of carbon emissions.
During October to December 2021, the Ministry of Ecology and Environment (MEE) conducted an inspection campaign on China’s carbon emission reports.
According to Tianyancha, a widely-used Chinese business information platform, all four agencies are qualified as “advanced and new technologies” companies. Previously, SinoCarbon had been designated in July 2021 as a “little giant” enterprise by the Ministry of Industry and Information Technology (MIIT) for excellent business performance and R&D achievements.
The exposed fraudulent activities include concealing and fabricating data, falsified coal sampling, statistical errors, and lack of adequate data verification. The MEE announced that further inspections at these companies will be conducted by local environmental bureaus, though no specific detailed procedures and subsequent sanctions were elaborated.
Notably, in January 2022, SinoCarbon announced that it was shutting down its carbon emission verification business due to a “conflict of interest”, whereby SinoCarbon also offers carbon emission consulting and management services.
In 2016, China set qualification criteria for MRV agencies. Industry experts consider standards were not strict enough to ensure quality services. Market entry and regulatory oversight of this industry needs further forms.
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