Industrial parks drive 50% of China’s industrial GDP while pumping out 31% of its CO₂ emissions. These powerhouse clusters have become China’s testing ground for systemic climate action, centered around its national Notice on the Development of Zero-Carbon Parks, issued early July, together with a number of guiding indicators.   

While decarbonizing Industrial parks is not a new topic, the term Zero-Carbon Parks rose to national prominence just last December at the 2024 Central Economic Work Conference.  In these slides on Zero-Carbon Parks: Demonstration, Standards, and Implementation, iGDP Analyst Liu Jingning maps out China’s existing Zero-Carbon Parks and relevant policies, drawing in part from multiple field visits. 

iGDP spearheaded an expert dialogue — weeks before the Notice’s release — bringing together policy advisors from government think tanks, the director of the Green Partnership of Industrial Parks in China, and private sector leaders to discuss policy gaps and implementation challenges.  

Based on these expert discussions and iGDP analysis, below is a high-level assessment revealing where the policy delivers, where it falls short, and what’s next. 

What is new this time: Zero-Carbon Parks will no longer be passive energy consumers but will transform themselves into active, renewable-powered innovation hubs.  

This entails: (1) restructuring energy supply through on-site renewables, green power direction connection, microgrids, and technologies like integrated source-grid-load-storage; (2) leveraging zero-carbon financing instruments that integrate carbon and energy data to innovate business models; (3) pioneering market reforms via green electricity trading and streamlined regulatory approvals; and (4) governing energy-industry-transport-building systems as interconnected ecosystems.  

Fundamental Challenges Getting Addressed: The Notice offers a clear definition of “Zero Carbon Park”, and sets out indicators, eight main decarbonization pathways, and a framework for net-zero transition. 

Before the national Notice, definitions and objectives for “zero-carbon” diverged across regions—leading to confusion over policy direction, inconsistent interpretation, and uneven implementation. Different types of pilot parks—manufacturing, logistics, commercial, or mixed-use—require distinct pathways and technologies. Yet tailored guidance remains scarce, leaving local actors without clear blueprints. Most regions also lack a unified indicator framework to guide project selection, track performance, and evaluate outcomes. For example, allowable carbon offset ratios vary widely across existing standards. Meanwhile, the absence of regular reviews, monitoring, and feedback loops means valuable lessons from pilots are rarely captured, preventing iterative policy improvement. 

The notice addresses some gaps, but not all.  

Evolving Policy Framework: Cross-ministerial alignment and local supporting policies could be stronger.   

Even with clearer goals and maturing technologies, policy coordination and limited incentives remain as challenges going forward. The Notice clarifies the roles of China’s government departments. The NDRC will lead overall coordination, national park list selection, and pilot funding. MIIT will guide low-carbon transformation in industrial parks. NEA will strengthen the green energy supply and drive innovation in park-level energy systems. 

 The Notice also calls on local governments to provide financial support, encourages policy banks to offer medium- and long-term credit, and supports eligible enterprises in issuing bonds for zero-carbon park projects.  

Transition Bottlenecks Persist: For industrial parks hosting energy-intensive sectors, energy transition remains technically and economically challenging. Additionally, green financial products are underdeveloped—especially for SMEs—dampening investment appetite. 

Large-scale renewable deployment is often not cost-effective, and intermittency demands storage or hydrogen-based backup—yet storage revenue models remain immature, green hydrogen costs are high, and grid flexibility is limited. 

New actions aim to speed up the demonstration and application of advanced low-, zero-, and negative-carbon technologies. At the same time, reforms in direct green power connections and smart microgrids seek to unblock the flow and integration of energy, materials, and data—reducing non-technical costs, strengthening the competitiveness of green industries, and expanding application scenarios. 

Data Remains a Structural Weak Link: Parks are not yet treated as independent carbon-accounting units, making granular emissions data collection difficult. 

Monitoring, reporting, verification (MRV) systems remain underdeveloped, while fragmented data from local authorities, power companies, and park enterprises complicates integration. Accounting methodologies, boundary definitions, and emission classifications vary, making cross-park comparisons difficult. The Notice specifies accounting methods, clarifies boundaries, and identifies emission sources. It also underscores the need for energy–carbon management platforms that cover major energy users in parks—enabling monitoring, forecasting, and load dispatch, as well as supporting carbon accounting, grid balancing, multi-energy integration, and efficient resource recycling.  

The Way Forward 

Developing zero-carbon parks demands a systemic transformation—overhauling energy systems, reshaping industrial models, advancing technologies, and reinventing management frameworks.  

What comes next? We expect to see the development of more local policies, more pilots, and more industrial parks at the subnational level applying to become national parks. Another thing to look out for is more detailed technical guidelines that will likely be released later this year. 

iGDP proposes focusing on these three areas in the near term: 1) Tighten policies by developing tailored decarbonization pathways for different park types and capping carbon offset ratios; 2) Launch digital carbon platforms featuring MRV systems for real-time monitoring, refined accounting standards for granular management, and integrated emissions, reductions, sequestration data ; 3) Strategically fund technology pilots, prioritizing scalable low/negative-carbon technologies and providing differentiated support throughout the innovation lifecycle from R&D to deployment. 

iGDP will continue to monitor policy developments in this area through our China Carbon Neutrality Tracker. Stay tuned! 

As always, please feel free to contact us with questions or comments.