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fund. Since 2012, the electricity price mark-up in favour of the
renewable energy has increased from RMB 0.004 to RMB 0.008 per
kilowatt hour. A rough estimate put the revenue from this change at
RMB 20–30 billion.
Moreover, local governments can enhance their guidance in the
low carbon investments in their territories through the venture capital
investment plans of emerging industries. For example, in the emerging
industries’ venture capital investment plans launched under the
Twelfth Five-Year Development Programme, the central government
allocated a part of its industrial technology R&D fund together with
the local governments’ fund and the social capital, by contributing to
their registered capital.
Since the Guiding Opinions on Standardized Establishment
and Operation of the Venture Capital Investment Direction Funds
was issued in October 2008, many local governments have set up
governmental venture capital investment direction funds. The
governmental investment direction funds refer to policy-based
funds which are established by the government and operated in a
market-oriented way. They aim to lead social capital into the venture
capital investment field by supporting development of the venture
capital investment enterprises. Their operation follows the principle
of government guidance and market-oriented operation and their
principal operation models include subscribing shares, providing
guarantee for financing, making follow-up investment, offering
investment guarantee, providing risk subsidies, etc. The governmental
investment direction funds can give impetus to the fiscal fund in
generating the leverage effect and guide the private capital into the
industries which are to be intensively developed. They mainly invest
in enterprises which are in the early or medium stage of their growth,
or in other words, in the seed or growth stage of their development. For
instance, the venture capital investment direction fund of Shanghai,
founded in March 2010, had a fund of RMB 3 billion; by partnering as
a parent fund with 12 venture capital investment funds, it leveraged
capital in the total amount of more than RMB 4 billion.
Box 2.1 is a case in which the central financial organization of
the EU partnered with the governments of its member countries to
set up affiliated funds with the aim of providing additional sources
of funds for the local governments in their efforts to develop a low
carbon economy. We propose that the Chinese government, on the
basis of the existing fund management models mentioned above and
through the central government’s fund, enter into partnerships with
98 Low Carbon Development in China and India
renewable energy has increased from RMB 0.004 to RMB 0.008 per
kilowatt hour. A rough estimate put the revenue from this change at
RMB 20–30 billion.
Moreover, local governments can enhance their guidance in the
low carbon investments in their territories through the venture capital
investment plans of emerging industries. For example, in the emerging
industries’ venture capital investment plans launched under the
Twelfth Five-Year Development Programme, the central government
allocated a part of its industrial technology R&D fund together with
the local governments’ fund and the social capital, by contributing to
their registered capital.
Since the Guiding Opinions on Standardized Establishment
and Operation of the Venture Capital Investment Direction Funds
was issued in October 2008, many local governments have set up
governmental venture capital investment direction funds. The
governmental investment direction funds refer to policy-based
funds which are established by the government and operated in a
market-oriented way. They aim to lead social capital into the venture
capital investment field by supporting development of the venture
capital investment enterprises. Their operation follows the principle
of government guidance and market-oriented operation and their
principal operation models include subscribing shares, providing
guarantee for financing, making follow-up investment, offering
investment guarantee, providing risk subsidies, etc. The governmental
investment direction funds can give impetus to the fiscal fund in
generating the leverage effect and guide the private capital into the
industries which are to be intensively developed. They mainly invest
in enterprises which are in the early or medium stage of their growth,
or in other words, in the seed or growth stage of their development. For
instance, the venture capital investment direction fund of Shanghai,
founded in March 2010, had a fund of RMB 3 billion; by partnering as
a parent fund with 12 venture capital investment funds, it leveraged
capital in the total amount of more than RMB 4 billion.
Box 2.1 is a case in which the central financial organization of
the EU partnered with the governments of its member countries to
set up affiliated funds with the aim of providing additional sources
of funds for the local governments in their efforts to develop a low
carbon economy. We propose that the Chinese government, on the
basis of the existing fund management models mentioned above and
through the central government’s fund, enter into partnerships with
98 Low Carbon Development in China and India
