Getting the fundamentals right: Measuring, reporting, and verifying carbon emissions at the city level in China

Whether they want it or not, cities will have to play a central role in the fight against climate change as they host over half of the world’s population and account for 80 percent of global gross domestic product. Nowhere is this more relevant than in China where cities already host more than 900 million people, but where should they start?

As is often the case in public policy, the ability to act on a problem requires reliable data. As such, cities’ capacity to mitigate climate change will depend on getting reliable greenhouse gas (GHG) emission data.  With such data, cities will need to establish municipal-level Measuring, Reporting, and Verification (MRV) systems. Such systems will help guide emission reduction efforts, resource allocations, and the development of comprehensive climate action plans.  

MRV systems can also come in handy for local governments that need to coordinate plans with provincial programs and demonstrate their contributions toward national climate targets. In recognition of this, China released in August 2022 an implementation plan for establishing a standardized and unified carbon emission statistical accounting system, which is intended to measure and report carbon emissions. This sends a strong signal of the importance of MRV systems.

While there have been recent policy developments, the work to set up city-level MRV in China is still in its early stages. Our analytical report has identified key challenges to the development and implementation of city-level MRV systems in China, including:

• A lack of a standard methodology for city-level emission accounting. The current MRV methodology applied to GHG inventorying by Chinese cities is inconsistent with the internationally accepted Global Protocol for Community-Scale Greenhouse Gas Emission Inventories (GPC). Most Chinese cities follow the GHG inventory guidelines that China has developed for provincial-level stocktaking. This inconsistency makes it difficult to compare between cities; limits the ability to aggregate GHG emission data from the local, subnational, and national governments; and restricts the practical relevance of using GHG inventories to inform decision-making.
• A lack of a coordination mechanism to pull in data from different sources. Functional MRVs require information from multiple sectors and government departments of a city, but Chinese cities lack a coordination mechanism for data collection and sharing. Moreover, the existing statistical databases were not designed to measure GHG emissions. They cannot serve as the basis for a reliable MRV system due to a lack of consistent approaches among agencies in data definitions, categorizations, and methodologies.
• Low-quality and delayed GHG inventories. Given that GHG accounting is an emerging city mandate, most Chinese cities lack professionals with the appropriate technical skills.

With support from the City Climate Finance Gap Fund, the World Bank’s Low Carbon Cities Program is documenting global best practices to inform cities’ efforts to establish MRV systems. As China strives to become a leader in the climate agenda, the development of its city-level MRV systems can benefit from global best practices:

• Chinese cities may consider developing a standardized GHG accounting protocol that is consistent with international practices for measuring and reporting citywide emissions. A standardized city-level, consumption-based GHG accounting protocol would help municipal governments better influence urban residents' consumption behaviors and energy use by enterprises. It would also allow for credible local and international comparison and aggregation, across years and geographic locations. 
• Cities should strengthen interdepartmental coordination by issuing executive orders. New York and Tokyo, for example, have enacted laws to conduct regular GHG inventories. Chinese cities can do the same and request periodic GHG inventories with a time lag of no more than one year. Currently, many city-level GHG inventories are scarce, and the existing ones have a lag of more than two years.
• Finally, MRV platforms must be turned into decision-making tools for informing climate strategies and monitoring progress toward climate goals. New York and Rio de Janeiro, for example, use GHG inventories as a statutory basis for assessing the performance of local governments and monitoring mitigation impacts. A well-functioning MRV system is more than GHG accounting. It should serve as an evidence-based tool to (i) inform climate action planning; (ii) set mitigation goals; (iii) assess emission reduction potential, and (iv) support cities to eventually access carbon exchange markets.

Chinese cities can contribute to the country’s ambitious climate agenda if they get the fundamentals right.  Building effective MRV systems to monitor GHG emissions in urban areas is a critical step towards meeting the country’s climate goals.