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Cities in GLOCAL Climate Governance:

Cases in Beijing

DRAFT

For 2016 ISA Asia-Pacific Conference, Hong Kong

June 27, 2016

Li Li

Assistant Research Fellow, China Foreign Policies Studies Center, China Foreign

Affairs University (CFAU);

Research Fellow, China Diplomacy Theory and Practices Collaborative Innovation

Center, CFAU & Center for China and Globalization (CCG);

2011-2012 China-U.S. Fulbright Ph.D. Candidate at University of Connecticut

(UConn).

lilian8006@cfau.edu.cn

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Abstract

Climate governance is a kind of global pure public goods. The warming effects of

global greenhouse gases (GHGs) cannot be isolated from regional or local causes,

and local extreme weathers can often find reasons from regional or global

warming. The intertwined causal relations between multi-level actors make

different actors collaborate innovatively. Beijing, the Capital of China, faced with

great environment governance challenges, has made much progress in recent

years. Multi-level actors in Beijing act locally, but think globally. They carry out

“GLOCAL” practices through transnational public-private partnerships (TPPPs),

such as clean development mechanism (CDM) and voluntary carbon market

(VCM). In those TPPP cases, local actors tend to create public-private hybrids to

break bottlenecks in existent political, economic and cultural institutions,

achieving low carbon goals in a four-stage life cycle: first, defining local

constraints by learning “best practice”; second, setting up public-private hybrids

consisted of key stakeholders; third, building low carbon capacities by making

full use of public and private resources; fourth, internalizing local experience by

disseminating know-how into a new spiral of evolution.

Key words: GLOCAL, climate governance, public-private partnerships (PPPs),

public goods, Beijing

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When we fly over the Asia-Pacific area, we may wonder about various skies above

the clouds: Why are the skies so locally different? What differences are there in the

localities to achieve common goals of climate governance?

Climate governance is an unprecedented “public goods” provision issue in need

of international cooperation in human history. Climate governance norms were

initiated by United Nations Framework Convention on Climate Change (UNFCCC),

and have recently witnessed a great progress in the reaching of Paris Agreement

on December 12, 2015. Since Kyoto Protocol was signed in December 1997, an

international agreement finally comes into being after 18 years of negotiation.

According to Article 21 of Paris Agreement, the agreement shall not enter into

force only when over 55 Parties to the Convention, accounting for more than 55%

of global GHG emissions, deposit their instruments of ratification, acceptance,

approval or accession (UNFCCC, 2015: 15).

Although there has been a scientific consensus that human-induced emissions of

greenhouse gases (GHGs, including CO2, CH4, N20, HFCs, PFCs and SF6) have

caused dramatic climate changes since the industrial revolution in 1860s,

manifest in the Assessment Reports (ARs) of Intergovernmental Panel on Climate

Change (IPCC) (Oreskes & Conway, 2010: 268-269; Hoggan & Littlemore, 2009;

Mann, 2012), GHGs emission reduction is more complex, and nation states are

facing more challenges than ever before. It’s very much different from the

situation when Montreal Protocol for Ozone Depletion Substances (ODS) was

signed in 1987 (amended in 1990, 1992, 1995, 1997 and 1999). It needs local

actors, together with nation state governments, to share more responsibilities.

This paper will take Beijing as an example to show what roles a city could play to

assist nation states in global climate governance.

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I. A Brief Review of Beijing Low Carbon Practices

Since the convention of the 17th Communist Party of China (CPC) National

Congress in 2007, as the national political and cultural center, Beijing municipal

government has been attaching great importance on transforming economic

growth model from an extensive high-carbon one into a resource-friendly

low-carbon one, aiming to build a “culture-enriched, technology-empowered and

environment-friendly” Beijing as a global city, and this concept was further

developed with the opportunity of the 29th Olympic Games held in Beijing in

2008. In 2010, “Environment-Friendly” Beijing Action Plan (2010-2012) was

issued aiming at building a modern world city by carrying out manufacturing,

consumption and environmental protection measures. In 2011, the “global city”

goal was written in the 12th Five-year Plan of Beijing focusing on social welfare

and public culture service, science and technology (S&T) innovation through

research and development (R&D), and to develop Beijing into an intensive,

effective and eco-friendly city (Dong, 2011).

In 2013, Beijing experienced the thickest haze lasting for several days, and the

Beijing Municipal Environmental Protection Bureau (BMEPB) carried out urgent

measures during the heavily polluted period, including coercive measures to

prohibit the usage of 30% of government cars in the extremely polluted districts

(Yin, 2013). From the first transaction of clean development mechanism (CDM)

project in Daxing County to the issuance of Panda Standard by China Beijing

Environment Exchange (CBEEX), carbon market standards, both compliant and

voluntary, has been prospered in Beijing. Although the city is still featured by a

top-down administrative procedure, private enterprises, brokers, communities,

non-governmental organizations (NGOs), scholars and other relevant actors are

more and more involved into climate governance process. What’s more, they are

collaborating with each other, constructing various types of public-private

partnerships (PPPs). The most striking cooperation of public and private actors

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are carbon markets.

II. The 1st CDM Project of China and CDM Centers

In 1997, when the Kyoto Protocol was signed, 3 flexible mechanisms—emission

trading (ET), joint implementation (JI), and CDM were introduced as additional

means of meeting countries’ mitigation targets, known as the “carbon market”

(UNFCCC, 2012a; Chen, 2008). With respect to the principle of Common but

Differentiated Responsibilities (CBDR) (UNFCCC, 1992: 1, 4, 5; UNEP, 2000: 1, 2,

25-30, 32, 34), developed and developing countries undertake different

responsibilities in tackling with climate threats. In late 2001, the 7th Conference

of Parties (COP7) passed the Marrakesh Accord, setting transaction methods and

development procedures of the CDM projects. In 2005, the Kyoto Protocol came

into force with the ratification of Russia, achieving coverage of 55% of global CO2

emissions.

As expressed in the Copenhagen Accord and the Cancun Agreement, developing

countries are encouraged to take nationally appropriate mitigation actions

(NAMAS) on voluntary basis according to their specific situation (UNFCCC, 2009,

2010). Carbon exchanges with a mandate “cap” of emissions are known as

compliant carbon markets (CCMs). CCMs are featured by “compliant access,

compliant mitigation”, for they are legally bound by the Kyoto framework and the

exchange volumes of CCMs are recorded in their carbon market tracing system.1

Currently, the “best practice” of CCM is in the European Union Emissions Trading

1 Countries’ targets are expressed as levels of allowed emissions, or “assigned amounts,” over the 2008-2012 commitment period, and the allowed emissions are divided into “assigned amount units” (AAUs). ET, as set out in Article 17 of the Kyoto Protocol, allows countries that have emission units to spare to sell this excess capacity to countries that are over their targets. JI, defined in Article 6, allows a country with an emission reduction or limitation commitment under the Kyoto Protocol (Annex B Party) to earn “emission reduction units” (ERUs) from an emission-reduction or emission removal project in another Annex B Party, each equivalent to one tonne of CO2 (The frequently used unit is MtCO2e, million tonnes of CO2 equivalent), offering Parties a flexible and cost-efficient means of fulfilling a part of their Kyoto commitments, while the host Party benefits from foreign investment and technology transfer. CDM, defined in Article 12, allows an Annex B Party to implement an emission-reduction project in developing countries, which can earn saleable “certified emission reduction” (CER) credits, which is the first global, environmental investment and credit scheme of its kind. Therefore, CDM is seen as a trailblazer (UNFCCC, 1998; 2012a, b, c).

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Scheme (EU ETS). Another effective mechanism is the CDM, and China is the

world’s biggest CDM host country, demonstrating its momentum in a governance

pattern of public-private hybrids (Schröder, 2012: 2).

1. The 1st CDM Project, Beijing, China

The first CDM project applied by China was the Anding Landfill Gas (LFG) Project

in Daxing District, 40 km south of the downtown of Beijing. The initiator of this

project, Zhang Yimeng, vice CEO of Beijing Jifeng Industrial Investment

Management Company, suggested the CDM mechanism to Liu Xiuchang, vice

director of Beijing Erqing Environment Sanitation Engineering Group Co. Ltd.

(Erqing), the owner of Anding Landfill (later merged as a branch of Beijing

Environmental Sanitation Engineering Group Ltd.), to apply technology from

Transpacific New Zealand (TPI NZ) to reduce methane (CH4) emission of solid

waste from 4,004 tons in 2005 down to 1,551 tons in 2014. The three

transnational public and private organizations signed a CDM project, starting this

landfill methane sequestration project from July 2002 (Zhang, 2007: 23).

By March 1, 2005, Jifeng Industrial Investment Management Co. has invested

over 20 million RMB yuan in Anding LFG Project, mainly for purchases and

installment of equipment. Since CDM project was a newly emerging mechanism,

there was no experience to be borrowed. They were “crossing the river by feeling

the stones”. From July 2002 to June 2004, there was no official CDM

administrative organization in China in charge of the project application,

approval and other complex procedures, and people were worrying about

possible invalidity of Kyoto Protocol if there were no enough depositories

ratifying the protocol. From project design to the emission reduction credits

approval and issuance. Documents prepared were more than one foot thick.

Luckily, they witnessed the successful test run in 2005 (Zhang, 2007: 23-24).

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In June 2004, “Interim Procedure of the CDM Project Management” signed by

National Development and Reform Commission (NDRC), Ministry of Science and

Technology (MOST) and Ministry of Foreign Affairs (MFA) came into operation.

Anding Landfill Project was first approved as the No.1 CDM project in China. In

May 2006, the UN representatives came to Anding Landfill and estimated the

carbon emission reduction amount as 50,000 tons of carbon dioxide equivalent

(CO2e), on the basis of emission volume from January 2005 to April 2006. Usually,

the estimation is higher than the actual amount.

Except for the inaccuracy of estimated emission volume, the price of certified

carbon credits is also volatile, which could go up and down between 200 RMB

yuan or so in a month (Zhang, 2007: 24). To protect the interests of enterprises

involved in CDM projects, NDRC set a reference price ($5 in 2004 and €8 later) as

a “threshold price”, under which application of CDM projects would not be

approved domestically. Later it was proved that this price did not hinder the

foreign direct investment (FDI) from the Annex I countries of the Kyoto Protocol,

but became a “best practice” for global carbon market (Schröder, 2009: 379-380).

In 2004, the World Bank price for CO2e per ton is $4.2, according to which the

estimated benefits for Anding Landfill CDM project would be at most $210,000

(about 1.6 million RMB yuan), which estimation was made on the condition that

the optimistically predicted 50,000 tons of CO2e could be realized. Comparing

with 20 million RMB yuan of preliminary investments, that amount of funding

could not be enough even for daily equipment maintenance (Zhang, 2007: 24).

Table 1 TPPP of Anding LFG Project with Public-Private Interactions

stakeholders identity provision

1 Zhang Yimeng, Beijing Jifeng Industrial Investment Management Company

Private CDM Advisory Agency

Initiator and preliminary investments.

2 Liu Xiuchang, Erqing (Owner of Anding Landfill)

Carbon Source (hybrid SOE)

Landfill gas collection and utilization.

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3 Energy Systems International (ESI) (Netherlands)

Carbon Sink Funding to buy reduced emission credits.

4 Transpacific New Zealand (TPI NZ) International Waste Dealer

Technology application.

5 UNFCCC International Organization

Emission volume estimation and verification.

6 National Development and Reform Commission (NDRC)

National Designated Authority (NDA)

“Interim Procedure of the CDM Project Management”; Setting “threshold price”.

7 Ministry of Science and Technology (MOST)

National Government

“Interim Procedure of the CDM Project Management”; Administration of CDM Centers at provincial level.

8 Ministry of Foreign Affairs (MFA) National Government

“Interim Procedure of the CDM Project Management”.

9 Beijing Municipal Environmental Protection Bureau (BMEPB)

Local Government

Measures to reduce GHG emission in extremely polluted districts.

10 Ministry of Environmental Protection (MEP) of China

Government

Publicizing major pollutants reduction status, introducing “best practices” among local actors.

As Table 1 illustrates, Anding LFG Project is a TPPP project (with shadow) among

five parties, including the UNFCCC as international organization as CDM project

registration authority. Around this TPPP project, there has been a lot of

public-private interactions (without shadow) providing “timing” for the

possibility of the five parties initiating “partnership”.

According to Figure 1, public and private stakeholders have been working

individually before they become partners in the Anding LFG project. Many

coincidental factors facilitates them to collaborate with each other under the

CDM mechanism. The most important two actors are carbon source (Erqing) and

carbon sink (ESI), but they could not meet each other without the initiator (Jifeng

Industrial). Such a CDM project would not become possible if TPI NZ doesn't

apply its sophisticated technology and rich experience in solid waste disposal

(TPI NZ).

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Figure 1 Diagram of Anding LFG Project with Public and Private Stakeholders

Multilevel actors involved in Anding LFG project could be categorized into 3

groups—international, national, and local (see the upper right box in Figure 1).

According to their organizational identity, they could also be divided into 3

kinds—public, private and hybrid.

The hybrid actor, Erqing, is a state-owned enterprise (SOE) based on Yiqing

Group, Erqing Group, Siqing Group and Beiqing Group, which could be traced

back to 1949. At the beginning, Erqing was established by Beijing Municipal

Government. Later, in 2006, it grows into a joint stock company, with a registered

fund of 900 million RMB yuan and a total asset of 1,700 million RMB yuan,

employing more than 5,000 workers. It is now the largest and best SOE in

environment sanitation of Beijing (Beijing Erqing Environment Sanitation

Engineering Group Co. Ltd., 2014). As an SOE, Erqing has its communist party

secretary-general as one of the top leaders, parallel to company manager. Its

hybrid identity doesn’t impede its business operation, but providing more

opportunities for the enterprises to be informed of national and local public

environment policies.

1

2

Joining Time

Relevance

3

4

5

6

7

8

9

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International Actor

5. UNFCCC (public)

3. ESI (private)

4. TPI NZ (private)

National Actors

6. NDRC (public)

7. MOST (public)

8. MFA (public)

10. MEP (public)

Local Actors

9. BMEPB (public)

1. Jifeng Industrial (private)

2. Erqing (hybrid)

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Figure 2 TPPP Model of the 1st Beijing Anding LFG CDM Project

Usually, local capacity building and “best practice” sharing in China often takes

place according to what governments are in great need of (Schröder, 2012:

45-46), but the Anding Landfill project was an exception. In 2002, there were no

CDM-relevant public policies and administrative institutions, Erqing launched

this project just because this enterprise would like to learn from foreign peers in

both innovative technology and involvement into international climate

governance mechanism. Anding LFG Project could be analyzed as a TPPP model

with international public (IPU) and private (IPR) stakeholders and local private

(LHY) and hybrid actors (LPR) (See Figure 2)

Before the Kyoto Protocol came into effect in 2005, Jifeng Industrial concentrated

its attention on Anding LFG Project. After that, it rapidly started numerous CDM

projects including wind power, hydropower, coal bed gas, etc. In the same year,

Jifeng merged into ESI, carrying out CDM projects in China as a sole agent of ESI,

actively playing its role of a carbon emission credits buyer (Zhang, 2007: 27).

2. Hybrids of Provincial CDM Centers

According to the experience of the first CDM projects, Chinese government

realized that CDM project could be a “win-win” mechanism for China, but there

International Public, IPU

Local Private, LPR

Local Hybrid, LHY International Private, IPR

International Private, IPR

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are many risks to be managed with international collaboration of both public and

private actors. Therefore, a national CDM project management system was

established in June 2007. At national level, the National Leading Group on

Climate Change (NLGCC), with Premier Li Keqiang as Director, Vice Premier

Zhang Gaoli and State Councilor Yang Jiechi as Deputy Directors, 30 ministerial

leaders of relevant ministries as members. 2 NDRC acts as the designated

national authority (DNA). MOST and NDRC are national CDM co-chairs. Local

departments of S&T, local commissions of development and reform, and relevant

divisions of local governments collaboratively establish CDM Project

Management Centers (CDM Centers) in provinces of China, to provide technical

assistance for projects application.

The first CDM Center was established in Ningxia Autonomous Region in 2003, set

up by Ningxia Department of S&T and Beijing Keji Consultation Company, with

the former as a local public actor and the latter as a private consultancy (Ningxia

CDM Environmental Protection Service Center, 2012). As an “early monopolist”,

Ningxia CDM Center has the first-mover advantage. However, since it lacks

communications with private organizations, there were funding problems in the

2 The 30 members include Xiao Jie, Deputy Secretary-General of the State Council, Wang Yi,

Minister of Foreign Affairs (MFA), Xu Shaoshi, Director of NDRC, Yuan Guiren, Minister of

Ministry of Education (MOE), Wan Gang, Minister of MOST, Miao Wei, Minister of Ministry of

Industry and Information Technology (MIIT), Li Liguo, Minister of Civil Affairs (MCA), Lou

Jiwei, Minister of Finance (MOF), Jiang Daming, Minister of Land and Resources (MLR), Zhou

Shengxian, Minister of Ministry of Environment Protection (MEP), Jiang Weixin, Minister of

Housing and Urban-Rural Development (MOHURD), Yang Chuantang, Minister of Transport

(MOT), Chen Lei, Minister of Water Resources (MWR), Han Changbin, Minister of Agriculture

(MOA), Gao Hucheng, Minister of Commerce (MOC), Li Bin, Director of National Health and

Family Planning Commission, Director of State-Owned Assets Supervision and Administration

Commission of the State Council (SASAC), Wang Jun, Director of State Administration of

Taxation, Zhi Shuping, Director of General Administration of Quality Supervision, Inspection and

Quarantine, Ma Jiantang, Minister of Ministry of Statistics, Zhao Shucong, Minister of Ministry of

Forestry (MOF), Jiao Huancheng, Deputy Secretary-General of the State Council and Director of

National Government Offices Administration, Xia Yong, Deputy Director of Legislative Affairs

Office of the State Council, Bai Chunli, President of Chinese Academy of Sciences (CAS), Zheng

Guoguang, Director of China Meteorological Administration, Wu Xinxiong, Deputy Director of

NDRC and National Energy Administration (NEA), Liu Xigui, Director of State Ocean

Administration, Lu Dongfu, Vice Minister of MOT and Director of National Railway

Administration, Li Jiaxiang, Vice Minister of MOT and Minister of Civil Aviation Administration

(CAAC), and Xie Zhenhua, Deputy Director of NDRC.

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later stage (Schröder, 2012: 136-137). After Ningxia CDM Center was established,

more centers mushroomed in 27 provinces of China. Most are composed by

provincial departments of S&T and private consultancies. Among them, the

Hunan CDM Center became an “aggressive new-comer”. It built the CDM center

into a private company, administrated by governmental organizations, but

operated and managed like a real company, encouraging Hunan enterprises to

apply CDM projects through high qualified services and customer-oriented

culture. Hunan CDM Center sets an example as a private enterprise

disseminating CDM norms with government’s public support (Schröder, 2012:

140).

CDM Centers as a hybrid is like a yin-yang fish in Chinese shadow boxing, which

tries to integrate opposites by taking their advantages, while avoiding their

disadvantages, so as to make a “win-win” optimum. Innovation in governance,

either international or domestic, is a public governance institutional contribution.

Observing various patterns of public-private hybrid in CDM projects is a good

way to find what variables may be important in such a TPPP mechanism, and

how to integrate it with current political system.

III. VCM in Beijing

In December 2012, just before the Copenhagen Climate Conference was

convened, the UNFCCC CDM executive board (EB) refused 10 wind power

projects applications from China, requesting relevant authorities to make a

decision on the “additionality” of those possible investments, suspecting Chinese

government deliberatively adjusted domestic wind power price downward to

steer wind power plants to apply CDM projects. Nine wind power enterprises

made a public statement, expecting EB to reexamine the application. The key part

of that debate was about “baseline” of carbon offsetting. Since CDM projects

requires that GHG emission reduction demands of developed countries, instead

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of economic decline (hot air) or domestic incentive policies, should be the sole

reason for developing countries to apply. However, with expanding of clean

energy market and changing of regulatory environment, domestic policies may

accommodate with low-carbon practices, instead of taking the CDM “baseline”

into consideration. It’s hard for a nation like China to give up active climate

mitigation policies due to fears for failure in getting “additionality” and CDM

funding. That’s a paradox between international offsetting and domestic

low-carbon policies.

To find more alternatives to CDM, China paid more attention to voluntary carbon

markets (VCMs). VCMs are contracts not legally bound by the Kyoto framework,

but signed on a voluntary basis, with a voluntary “cap” of emissions for carbon

exchanges, featured by “voluntary access, compliant mitigation”. Standard-setting

process of VCM provides indicators for public and private actors to assess

themselves quantitatively, important for comparing mitigation practices from a

microscopic angle. The price of carbon credits, credits of exchanges, norms

innovation, local methodologies, are all crucial for climate governance

measurement.

In July 2008, China established its first VCM, the Energy-Saving and Emission

Reduction Projects Center, in Lüliang City of Shanxi Province, and had its opening

ceremony in Beijing. In August and September, China Beijing Environment

Exchange (CBEEX) and Shanghai Environment Energy Exchange were set up in

succession. In 2009, Tianjin Property Rights Exchange (TPRE) was opened. Later,

VCM exchanging platforms were seen one after another at Chengdu (Sichuan),

Wuhan (Hubei), Changsha (Hunan), Kunming (Yunnan), Hangzhou (Zhejiang),

Guangzhou (Guangdong), Shenzhen (Guangdong), and Hongkong (SEZ).

As a pioneer in VCM, CBEEX announced the 1st VCM standard, Panda Standard

V1.0, during the Copenhagen Climate Conference in 2009, which is a voluntary

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carbon emission reduction standard reflecting national conditions of China. The

idea of setting such a nation-based standard was proposed by Bi Jianzhong,

general manager assistant of CBEEX. After the Beijing Olympic Games in 2008, Bi

realized that China should have its own voluntary carbon emission reduction

standard to reduce costs in transportation, translation, and transnational

procedures. So he suggested that CBEEX may invent a carbon exchange standard

congruent with China’s situation. That suggestion was strongly supported and

started to be put into practice since September 2009.

Table 2 Setting of Panda Standard from A TPPP Perspective

stakeholders identity provision

1 Bi Jianzhong general manager assistant,

CBEEX

suggestion for standard

setting

2 Mei Dewen general manager, CBEEX naming

3 US Environmental

Defense Fund International NGO

Duke’s Law: step-by-

step guidelines for

VCM standard setting

4 BlueNext (France) international developer information sharing

5 China Forestry

Exchange

hybrid agency(MOF/Beijing

Municipal Government) domestic experience

6 Winrock International

(US) International NGO

Agriculture Standard-

setting experience

Formerly, most of China’s voluntary carbon exchanges were dealt with by Chicago

Climate Exchange (CCX). When CBEEX tried to design Panda Standard, named by

Mei Dewen, general manager of CBEEX, they decided to apply carbon offsetting

principles from “Duke’s Law”. “Duke’s Law” is a set of carbon offsetting guidelines

for farmers, foresters, land managers, and those who are interested in putting

GHG offsets into a tradable commodity, summarized by two groups of

independent scientists, sponsored by US Environmental Defense Fund since early

2004. “Duke’s Law” emphasized the competitive advantages of carbon sinkers,

for industries who emit GHGs should pay landowners and farmers who store

carbon to offset carbon emissions (Willey & Chameides, 2007: ix-x, 3). With the

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step-by-step guide of “Duke’s Law”, in the pursuit of climate mitigation and

poverty alleviation, in collaboration with BlueNext (France), China Forestry

Exchange, and Winrock International (US), CBEEX issued Panda Standard on

Copenhagen Conference on December 12 (Zhang & Huan, 2009). As Table 2

shows, the setting of Panda Standard could also be perceived as a TPPP project,

with supports from national and local governments, international NGOs, and also

hybrid enterprises.

According to the World Wildlife Fund (WWF), in 2008, there have been 22 main

VCM standards in use (Kollmuss, Zink, Polycarp, 2008: xi). The issuance of Panda

Standard was a cornerstone of China’s VCM. China started its exploration of ways

to coordinate national compliant low-carbon actions with international

“additionality” norms.

On September25, 2015, U.S.-China Joint Presidential Statement on Climate Change

was signed, in which President Xi declared that China will establish a nationwide

“cap-and-trade” carbon exchange system, covering industries of power, steel,

chemical engineering, etc. (Zhang, 2016) When that carbon market is put into

operation, the scale might exceed EU ETS and become the largest carbon market

in the world (CBEEX, 2015).

The first VCM applying Panda Standard was Yunnan Xishuangbanna Bamboo

Afforestation Project, certified on March 29th, 2011, in which Franshion

Properties (China) Ltd. purchased 16,800 tons of Panda Standard

voluntary emission reduction (VERs) from Yunnan Mengxiang Bamboo Industry

Co. Ltd. As the first demonstration project of Panda Standard, this project planted

59,000 hectares of dendrocalamus giganteus forests, which will restore an

ecological balance for the degraded land, so as to achieve the certification from

Forest Stewardship Council for sustainable use of forests, alleviating local

poverty through development of forestry industry (China Beijing Equity

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Exchange, 2011). Table 3 shows relevant stakeholders and their provisions in

this project.

Table 3 TPPP of Yunnan Xishuangbanna Bamboo Afforestation Project

stakeholders identity provision

1 Franshion Properties (China)

Limited carbon source Buyer

2 Yunnan Mengxiang Bamboo

Industry Co. Ltd. carbon sink VERs owner

3 French Development Agency

(afd) NGO Funding

4 French Global Environment

Facility NGO Funding

5 The Administrative Center for

China’s Agenda 21 (MOST) Government Technical support

6 The Nature Conservancy NGO Methodology

7 Yunnan CDM Center Hybrid Agency Project Design

Documents (PDDs)

8 Carbonium Private Enterprise Carbon Financing

Consultancy

9 CBEEX Hybrid Agency Carbon Exchange

Platform

10 BlueNext International Private

Enterprise

Carbon Exchange

Platform

It’s worth mentioning that this project was one of the portfolio projects of

China-France “Rural Carbon” Development and Capacity Building Project in

Yunnan and Sichuan Provinces, which is the Phase-2 project of China-France

Clean Development Mechanism (“CDM”) Cooperation since 2006. Conforming to

the Joint Declaration of China and France on Response to Climate Change reached

when President Hu Jintao visited France in November 2010, it’s a CDM project

framework on the basis of China-France international cooperation (French

Development Agency, et. al., 2013). But Yunnan Xishuangbanna Bamboo

Afforestation Project is not a CDM project, but a VCM project, applying Panda

Standard to fulfil corporate social responsibilities.

IV. Conclusion: Heterogeneous Localities, Common New Paradigm.

Political, economic and cultural diversities lead to heterogeneities for non-state

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actors to fulfil low-carbon responsibilities, but one thing seems similar--they

have to innovate. As a GLOCAL actor, Beijing carries out low-carbon practices

locally, but connects with global public goods provision system through carbon

market practices.

1. A Four-Stage Life Cycle of TPPP

In those TPPP cases, local actors tend to create public-private hybrids to break

bottlenecks in existent political, economic and cultural institutions, achieving low

carbon goals in a four-stage life cycle:

.First, defining local constraints by learning “best practice”;

.Second, setting up public-private hybrids consisted of key stakeholders;

.Third, building capacities by making full use of public and private resources;

.Fourth, internalizing by disseminating know-how into a new spiral of evolution.

2. Three Fundamental Changes

Through microscopic observation of how GLOCAL actors fulfil their climate

governance responsibilities, we could find three fundamental changes of global

public goods providing paradigm.

(1) Peer Production: Change in Methods

In the past, facing with global governance difficulties, international organizations

(IOs) promote nation states to comply with international norms, and those which

are congruent with regional norms may be more easily accepted (Acharya, 2004:

239-275). Local heterogeneities make bottom-up trajectories necessary, pushing

the climate governance into a dual-track system with both top-down and

bottom-up procedures.

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Inside the duel-track system, multi-level actors, both public and private, initiate

partnership according to their own demands and supply. Just like users of

Internet, peers with same interests can find each other through network,

composing teams to provide their know-how and expertise, until they solve the

problem. Such project-oriented mass collaboration is better unified for they are

personally willing to be involved in climate governance. They are sure that their

innovative solutions for existent problems may get larger-scale rewards than

expectation, so they are not afraid of free-riders. On the contrary, they regard

free-riders in the early stage of provision as potential peers who will realize the

advantages of their innovative knowledge, and be determined to buy or join the

public goods production process (Tapscott & Williams, 2010).

The concept of “Peer Production” was proposed by Prof. Yochai Benkler in 2002,

which means a mass production paradigm led by individual innovation on ideas

or methods, with collaboration and coordination in projects framework for

potential added value as objectives. Peer Production could be taken as a new

paradigm, for it’s different with hierarchical production led by central

policy-making and market production led by demands of customers. It’s a

open-source paradigm of innovation and collaborative R&D based on relevance

and credibility. Since the principles are like that of Wikipedia, it’s also called

Wikinomics or Open-source Economics (Benkler, 2002: 372). The innovative

inspiration and first-mover advantage of peer production could bring large-scale

benefits and value-adding space, and networked communication will improve

efficiency of global climate governance, lower costs of public governance, so that

more individuals would like to join the public goods provision process.

(2) “Prosumer”: Change in Relations

There is a kind of actors, who themselves are in need of public goods. At the same

19

time, they are constant consumers of public goods. They are called “prosumers”

of public goods (Toffler, 1980: 265-266). With the enlargement of peer

production network and increase of prosumers, there will be a kind of “cloud

effect”, blurring the border between industries and identities of producers and

consumers. In this process, capacity building is the key for consumers to become

qualified prosumers. “Prosumer alliance” with functions of talents nurturing,

norm socialization and incentive mechanisms will be important accelerators for

capacity building. Prosumers are often public entrepreneurs with insights and

activism in different industries. Rewards from being free-ridden may not be

calculated in material, but in terms of “priceless price” (Ackerman & Heinzerling,

2005: 8-9, 164, 177). When the concepts, perceptions and ideas could be put into

practices, the “priceless price” will have its timing to be transformed into priced

commodities (Speth, 2009: 75). We are now in such an era of transformation.

(3) Collaboration: Change in Partnership

It took 16 years for human beings to change the 1st carbon trading of AES Corp

into the carbon market under the Kyoto Protocol (Trexler, Faeth & Kramer, 1989).

The 1st carbon trading project, the 1st CDM project in China, the 1st project

applying VCM Panda Standard were all carried out in TPPP. According to the

global governance literature, public and private actors have been mentioned as

subjects managing their common affairs across borders, in which process

conflicting or diverse interests are accommodated (The Commission on Global

Governance, 1995:4).

More obstacles should be tackled when PPPs are introduced to conquer both

“government failure” and “market failure”, for it’s more complicated and

efforts-taking to find the equilibrium point between government and market. But

that’s what our era is in need of, for human beings are welcoming a sixth

innovation wave focusing on new energies and low-carbon technology in 2024 or

20

so (Moody, Nogrady, 2010). Only those who could successfully coordinate

economic growth with the balance of ecological system can achieve better

governance.

PPP perspective takes international relations (IR) scholars out of the good-or-evil

human nature mindset, but to fully understand the incapability of human beings

in conquering global challenges. With such a belief, they find a brand-new world

of various vacancies of capacity building, some being limitations of actors

themselves, some being loopholes of current policy systems in need of

clarification or amendment. Climate governance will be more successful by

mutual capacity building of public and private actors, in order to tackle

uncertainties (Schäferhoff, Campe & Kaan, 2009: 463).

From this perspective, significance of IR research on global governance would be

to find out the capacity building potentials and contribute wisdoms in removing

obstacles in the way. The world is not an arena of wars and conflicts with

indifferent or angry actors struggling in the anarchic international system, but of

passive actors who expect a better world without knowing how.

PPP scholars believe they have inborn “innovative” capabilities, which is an

important force promoting the real development of the world. In most cases,

developing countries need more capacity building efforts made (Ruggie, 2003:

310), but that does not mean developed countries don’t need any.

21

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