Introduction

The development of zero-carbon industrial parks has emerged as a strategic pillar for achieving China’s carbon peaking and carbon neutrality goals. At the same time, it is generating substantial and increasingly diverse financing needs. According to incomplete statistics, China currently has more than 15,000 industrial parks, which collectively account for over 30% of the country’s total carbon emissions.[1] The transition from conventional industrial parks to zero-carbon parks represents not only a technological transformation but also a profound shift in investment logic and asset structures. Consequently, financing needs are becoming increasingly differentiated and multi-layered. However, traditional financial instruments remain misaligned in areas such as maturity matching, risk pricing, and asset identification, while policy frameworks and standards still contain gaps in several emerging sectors. How finance can accurately empower and proactively adapt to the needs of zero-carbon parks has therefore become a critical issue in enabling their large-scale deployment.

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I. Financing Needs of Zero-Carbon Industrial Parks

Emerging Business Models and New Financing Requirements

The development of new business models within zero-carbon parks is creating unprecedented demands on financial services.

In the energy sector, integrated systems combining generation, grid, load, and storage (“source-grid-load-storage” integration) as well as virtual power plants (VPPs) are gradually taking shape. The novelty of these models is reflected in three dimensions.

First, they introduce innovative business models. Virtual power plant operators aggregate distributed renewable energy resources, energy storage systems, and flexible loads to participate in ancillary electricity markets and generate revenue.[2] Such revenue streams depend on high-frequency forecasting, load dispatching, and market trading capabilities, which differ fundamentally from traditional credit assessment models based on physical collateral.

Second, there is a mismatch between investment and return cycles. For example, park-level energy storage facilities require significant upfront capital investment, yet rapid technological advancements in battery technologies expose these assets to technological obsolescence risks. Financial products must therefore incorporate full lifecycle asset value management.

In the green building sector, technologies such as Building-Integrated Photovoltaics (BIPV) and ultra-low-energy passive buildings significantly increase construction costs compared with conventional buildings. However, these additional investments are typically recovered through energy savings over a building’s entire lifecycle of 30–50 years,[3] creating a mismatch between long project payback periods and relatively short financing tenors.

Emergence of New Asset Classes

The development of zero-carbon parks is also redefining asset boundaries and creating new categories of financeable assets.

Examples include carbon assets and the environmental attributes of green electricity. As China’s national carbon emissions trading market, the China Certified Emission Reduction (CCER) market, and various local carbon-inclusive trading platforms continue to mature, carbon allowances and emissions reductions generated by enterprises within industrial parks are increasingly assigned explicit market values, thereby acquiring tradable and pledgeable asset characteristics.

Some financial institutions have already begun developing innovative products based on the separate pricing of the “electricity value” and “environmental value” of renewable power. In addition, the integration of carbon assets into supply chain finance is being explored, extending carbon asset applications from single-enterprise collateral financing to coordinated carbon management across industrial value chains.

Against the backdrop of rapidly growing financing demand, Jiangsu Province became the first region in China to introduce a comprehensive top-level policy framework. In March 2026, the Jiangsu Branch of the People’s Bank of China, together with three other government departments, issued the Implementation Plan for Financial Support for the High-Quality Development of Zero-Carbon Industrial Parks, outlining twelve specific measures.

Key initiatives include establishing dedicated financing products such as “Zero-Carbon Park Loans,” requiring financial institutions to set aside dedicated credit quotas, and incorporating indicators such as renewable electricity consumption ratios and carbon emission intensity into credit approval processes. The plan also promotes carbon asset-backed financing and “Supply Chain Finance + Zero Carbon” models, transforming carbon assets from peripheral collateral into core financial assets. Furthermore, it supports diversified financing channels, including carbon-neutrality bonds, transition bonds, and pilot programs for green foreign debt financing. Together, these measures provide a clear roadmap for precision financial support for zero-carbon industrial parks.

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II. Pathways for Financial Support to Zero-Carbon Industrial Parks

The complex investment structures and diverse stakeholder needs of zero-carbon parks pose systemic challenges to traditional financial service models. To address financing bottlenecks, financial institutions must adapt their product design, risk assessment frameworks, and resource allocation mechanisms. Existing domestic and international practices provide useful references, with key innovations concentrated around four dimensions: projects, enterprises, assets, and risk management.

Supporting Large-Scale Green Infrastructure

Government special-purpose bonds and policy finance have become critical instruments for meeting the long-term, low-cost financing needs of major green infrastructure projects.

Energy transition projects within zero-carbon parks—including integrated source-grid-load-storage systems, smart microgrids, and large-scale green power transmission infrastructure—are highly capital-intensive, characterized by large upfront investments, long construction periods, and significant public benefits.

Jiangsu Province’s implementation plan explicitly encourages eligible zero-carbon park infrastructure and energy-efficiency projects to seek financing through local government special-purpose bonds. Policy banks have also been exploring innovative financing solutions. For example, the Ningxia Branch of the China Development Bank provided RMB 144 million in financing for a 100 MW/200 MWh shared energy storage project through a combination of early-stage loans and long-term project financing, effectively reducing financing costs.[4]

Meeting Diverse Corporate Financing Needs

Financial institutions are increasingly developing differentiated products tailored to the distinct needs of large enterprises and small and medium-sized enterprises (SMEs).

For leading enterprises, hybrid financing models combining equity and debt have gained traction. For example, the Nanchang Branch of Industrial Bank, together with CIB Financial Asset Investment Co., Ltd., supported leading solid-state battery manufacturer Ganfeng Lithium Battery in securing RMB 1 billion in Series C strategic financing through a combined equity-and-debt structure.[5] Complementary services included green credit and supply chain finance, enabling the company to accelerate capacity expansion and technological innovation while allowing financiers to share in future growth and offset technology-related uncertainties through risk premiums.

For SMEs with limited collateral, financing solutions increasingly focus on monetizing future performance. Industrial Bank’s “Carbon Finance + Supply Chain” coordinated emissions reduction program serves as a notable example.[6] Under this model, carbon accounts are established for charging infrastructure operators and their suppliers, linking financing costs directly to carbon reduction performance. The greater the emissions reduction achieved, the lower the financing cost. Such energy-efficiency-linked lending models transform intangible carbon performance data into tangible financing resources.

Financial Innovation Around Carbon Assets and Green Power

Financial innovations surrounding carbon assets and green electricity trading are rapidly emerging, with the primary objective of standardizing environmental benefits into financeable assets.

In carbon asset financing, an increasing number of banks now accept carbon allowances and CCER credits as eligible collateral and have introduced dynamic pledge financing products that adjust collateral ratios and credit limits based on fluctuations in carbon market prices.

In green power trading, Bank of Communications Financial Leasing (BOCOM Leasing) has pioneered an innovative model through China’s first Green Electricity Certificate (GEC) transaction linked to a photovoltaic power station.[7] The model separates the project’s revenue streams into electricity value and environmental value. Electricity value continues to derive from power sales, while environmental value is monetized through nationally certified green certificates traded on the Guangzhou Power Exchange. This creates a dual-revenue structure that enhances project profitability and financing potential.

Building Comprehensive Risk Management Systems

The systemic nature of zero-carbon parks means that no single credit instrument can adequately address transition risks. As a result, integrated financial services and risk-sharing mechanisms are becoming increasingly important.

The operation of zero-carbon parks requires coordination across the entire energy value chain, from generation and transmission to consumption and storage. Failure in any link may result in systemic losses.

Virtual power plants illustrate this challenge well, as their operation depends on the integration of generation forecasting, load aggregation, and real-time response capabilities. To address such complex risks, insurance-based risk management is becoming increasingly important.

China Pacific Property Insurance’s “Three Roles” strategy exemplifies this trend.[8] The strategy focuses on:

1. Strengthening risk protection for energy transition projects, infrastructure upgrades, and advanced technology deployment;
2. Enhancing risk prevention and mitigation services by moving risk management upstream;
3. Expanding integrated carbon services, including carbon footprint assessment and carbon accounting support.

Looking ahead, coordinated models combining bank financing, insurance protection, and digital risk management systems are transforming the systemic complexity of industrial park decarbonization into manageable and financeable risks.

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III. Future Prospects for Financial Support of Zero-Carbon Industrial Parks

Case-by-Case Innovation Before Standards Mature

In the near term, an important direction for financial support lies in proactively addressing areas where standards have yet to fully develop.

Although China has established a foundational framework for zero-carbon park development, detailed standards and certification systems for emerging technologies—including virtual power plants, hydrogen metallurgy, carbon capture, utilization and storage (CCUS), and second-life battery applications—remain underdeveloped.

Financial institutions should therefore move beyond standardized templates and adopt project-specific evaluation mechanisms, assessing technological feasibility, business model maturity, and emissions reduction impacts on a case-by-case basis. Early pilot projects can help accumulate data, validate business models, and pave the way for future standardization and scaling.

From Single Instruments to Integrated Financial Ecosystems

Financial innovation is expected to evolve from standalone products toward integrated solutions.

Currently, green loans remain the dominant financing tool, while the potential of bonds, equity financing, insurance, and derivatives remains largely untapped. The future direction points toward a comprehensive ecosystem integrating investment, lending, insurance, bonds, and carbon finance.

On the debt side, Sustainability-Linked Bonds (SLBs) could incorporate key performance indicators such as renewable electricity consumption ratios or carbon intensity per unit of industrial output, incentivizing continuous energy transition.

On the equity side, Infrastructure Real Estate Investment Trusts (REITs) are expected to play an increasingly important role. Mature assets with stable cash flows—including photovoltaic power stations, EV charging networks, and energy storage facilities—could be securitized through REITs, creating a virtuous cycle of construction, operation, exit, and reinvestment.

Insurance products covering the entire lifecycle of emerging technologies are also likely to become an important supporting mechanism.

Digital Finance as Critical Infrastructure

Digital finance is poised to become the key infrastructure enabling efficient financing within complex zero-carbon ecosystems.

The complexity of financing needs arises largely because energy flows, capital flows, and data flows remain disconnected. Future development will likely focus on integrated digital platforms combining energy and carbon management with financial services.

Through IoT sensors and blockchain technologies, real-time data on energy consumption, carbon emissions, and renewable electricity traceability can be collected and integrated directly into financial institutions’ risk management systems.

This would enable “data-for-credit” models, allowing SMEs with limited conventional credit histories to access financing based on verified emissions reduction performance. It could also support transformative applications such as automated carbon accounting and benefit allocation through smart contracts linked to digital currency transactions.

Conclusion

The future of financial support for zero-carbon industrial parks is promising, but challenges remain substantial.

This transformation extends beyond capital provision. It represents a fundamental reconfiguration of asset valuation, risk management, and industrial ecosystems. Only through coordinated efforts among governments, financial institutions, industrial park operators, and third-party service providers—in areas such as standards harmonization, data sharing, and product innovation—can zero-carbon industrial parks become new growth engines for green and low-carbon development and strengthen China’s competitiveness in the global green economy.

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References

[1] Qiu, Lijing. Analysis of Development Opportunities and Pathways for Zero-Carbon Industrial Parks under China’s Dual Carbon Goals. China Energy Media Energy Security New Strategy Research Institute, August 5, 2025.

[2] Wang, Xiao. “The Construction of Zero-Carbon Industrial Parks Calls for Precision Financial Support.” China Financial News Network, April 21, 2026.

[3] SSDC Green Building Consultants. Unlocking the Combined Advantages of the Internal and External Costs of BIPV (Part II), January 23, 2026.

[4] Dong, Tong, and Li, Yuan. “China Development Bank: Advancing Green Finance to Enhance Ecological Development in Ningxia.” People’s Daily Online, August 18, 2025.

[5] Song, Qiulei. “Industrial Bank Nanchang Branch Deepens Strategic Cooperation with Ganfeng Lithium.” Dajiang News, December 4, 2025.

[6] “Industrial Bank Xi’an Branch Launches Shaanxi’s First ‘Carbon Finance + Supply Chain’ Coordinated Emissions Reduction Financing Project.” China Financial News, December 30, 2025.

[7] “BOCOM Leasing Completes Its First Green Certificate Transaction for a Renewable Energy Photovoltaic Power Station.” Shanghai Municipal Financial Affairs Office, June 12, 2025.

[8] Zhang, Ruochen. “Insurance Providing Comprehensive Support for the Development of Zero-Carbon Industrial Parks.” Dazhong Daily Online, April 23, 2026.

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Author

Ren Yujie
Director, Green Finance Research Center
International Institute of Green Finance (IIGF), Central University of Finance and Economics (CUFE)