Monday 14 October 2013

China uses market incentives to reduce air pollution

Bad air pollution?  Will financial incentives get results in China?  $816.91 million should help.  Reuters reports on China's latest attempt to reduce those pesky PM 2.5 particles.

Enforcement is a huge problem but with the right incentives (cold hard cash) I have a sneaky feeling that this will actually get results.  Promotion used to depend on growth and growth alone.  The environment took a hit.

Whether this works will all depend on who gets the money and how it is then "shared".

China offers rewards to six regions to fight air pollution [Reuters]

(Reuters) - China said on Monday it would give rewards amounting to 5 billion yuan ($816.91 million) for curbing air pollution in six regions where the problem is serious, underscoring government concern about a source of public anger.

The Finance Ministry said the regions eligible for the rewards were Beijing and its neighboring city of Tianjin, the provinces of Hebei, Shanxi and Shandong, as well as the Inner Mongolia Autonomous Region.

The awards would be made at the end of the year and would be determined by pollution reduction targets, investment in tackling the problem and falls in PM 2.5 particles, which are especially bad for health, the ministry said on its website.

The provinces of Shanxi and Inner Mongolia are among China's top coal-producing provinces and have been a major source of air pollution.

Smog over northern cities in January generated widespread anger as did the discovery of thousands of dead pigs in March in a river that supplies water to the city of Shanghai.

Protests over pollution in China are becoming common, to the government's alarm. Authorities have invested in various projects to fight pollution and even empowered courts to mete out the death penalty in serious pollution cases.

But the results have been mixed. Enforcement of rules has been patchy at the local level, where district authorities often rely on taxes from polluting industries.

State media said in July the government planned to invest 1.7 trillion yuan ($277 billion) to fight air pollution over the next five years.

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