Foreword
The Ministry of Ecology and Environment (MEE) has recommended a total of 166 EOD projects to financial institutions, including 94 pilot projects in two batches and 72 projects in the warehouse. It is understood that the recommended industries related to the EOD project mainly include ecological agriculture, cultural tourism industry, health industry, clean energy, high-end intelligent manufacturing, digital economy, etc. Although the recommended projects have completed the project warehousing in accordance with the requirements, some projects are difficult to complete the financing when the project is actually implemented, even if the EOD project realizes the overall capital self-balancing calculation from the financial point of view, it is difficult to attract social capital.
Based on the requirements of the standard implementation of EOD projects, combined with the experience of planning, packaging and financial calculation of many EOD projects in which I have participated, the author will talk about how to do a good job in the balance of funds for EOD projects, so as to more effectively achieve the balance between the overall benefits and costs of the project.
1. Normative requirements for financial calculation of EOD projects
On March 8, 2022, the Ministry of Ecology and Environment (MEE) issued the Guidelines for the Warehousing of Ecological and Environmental Protection Financial Support Projects (Trial) (Huanban Kecai 2022 No. 6) (hereinafter referred to as Document No. 6), which aims to guide financial funds to invest in environmental governance projects, strengthen the precise support of finance for the in-depth fight against pollution, and strengthen the financing feasibility of EOD projects. At the same time, Circular No. 6 also makes further requirements for the compliance of project revenues: first, strengthen the planning of major projects, optimize the construction content of projects, and strive to achieve a balance between the overall benefits and costs of the project without relying on the highest investment;Second, in addition to the standardized PPP project, it does not involve the payment during the operation periodThird, the return subsidies such as land transfer income, taxes, and expected new fiscal revenues are not used as project income.
Although the above provisions on project benefits are relatively general, there is a core requirement, that is, the project as a whole should achieve a "balance between benefits and costs", and for this reason, the balance of funds around project input and output has become one of the most critical matters in the financial calculation of EOD projects.
2. Common problems in the practice of estimating the balance of funds for EOD projects
The EOD project is a comprehensive package and integrated implementation project, that is, the ecological environment governance project is matched with resources and industrial development projects, and the economic value brought by the ecological environment governance is internalized through integrated implementation and overall promotion, so as to realize the integrated development of environmental governance and industrial development. Achieving self-balancing of EOD project funds is the "red line" and "bottom line" requirements for the current EOD project storage, and it is also an important guarantee to prevent the introduction of new hidden debts. However, in the process of planning and implementation of EOD projects, the handling of problems related to the balance calculation of project funds is not very ideal, and many projects are not connected with financial institutions when planning and packaging.
In practice, the problems existing in the calculation of fund balance mainly include the following:
1. The calculation lacks scientific and reasonable basis and effective data support
The common problems in the calculation of project funds are: there is no reference standard and fee basis for the income calculation of some projects, and the overall calculation lacks a solid market research foundation in the early stageThere is also a lack of scientific and reasonable calculation basis, which leads to the unclear explanation of the unit price and quantity of the project operating income, resulting in the lack of scientific and convincing calculation of the project's revenue. For example: What is the basis for ticket pricing for cultural tourism projects?How is footfall determined?Whether there are projects, market transactions, basic data for ecological planting and breeding, etc. If there is no sufficient basis for estimation and market research, the final calculation results of operating income will be very different.
2. There is a phenomenon of "inflated and inflated" in the calculation of the income of operating projects
In order to achieve the overall balance of funds, some projects have inflated and inflated income, resulting in the income of the entire project obviously inconsistent with the reality. For example, in an industrial park project in a central and western county, the operating income of factories and office buildings is estimated to be "operational upon completion, and full load upon operation", that is, the occupancy rate can reach 90% in the first two years after completion, and 95% in the third year and beyond. This completely ignores factors such as the need for time to cultivate the operation of industrial parks and whether the ability of local governments to attract investment can be realized, even in some economically developed and core industrial parks on the eastern coast, it is difficult to achieve this ratio.
In order to achieve a balance of funds, some projects do not consider the industrial base and market capacity at all, and detach themselves from the actual expansion of the scale of the operating project, which ultimately leads to the loss of rationality of the project packaging and project income.
3. There are omissions in the calculation of project operating costs
The operating costs of EOD projects include not only the operation and maintenance costs of environmental projects, but also the operation and maintenance costs of industrial projects. In the overall calculation, there should be no missing items, and in practice, there are two common situations in which the project operating cost is missing: one is to consider the overall construction investment of the project and the operating cost of the environmental treatment project, while ignoring that the operation of the operating project itself also requires a large amount of operating cost investment;The other is to consider the overall construction investment of the project and the operating cost of the operation project, but not consider the operating cost investment of the environmental governance project, which leads to the omission of the operating cost calculation and the low overall project cost estimate.
4. There is "homogeneity" in the income of the same project
In the practice of EOD projects, it is encountered that several related industries packaged by some projects are biased towards cultural tourism, and there is a phenomenon of "homogenization" of income. Based on factors such as the large impact of the market environment and the relatively weak ability to resist risks, and the large fluctuation of the income of cultural and tourism projects, it is difficult to accurately obtain income, and it is also difficult to ensure that the income is relatively stable, which will lead to unstable cash flow for project repayment, resulting in low recognition of this part of the income by many financial institutions, especially policy banks, and the difficulty of project financing.
5. Part of the income** lacks a basis for compliance
At present, there are still problems in the practice of EOD projects that regard the income of natural resources such as sand and gravel and waste rock as project income**, but it is impossible to explain the legality and compliance path of its income rights. There is also the problem of taking the income from land index transactions as project income**, and failing to clarify the compliance path, resulting in the consequences that the expert review and argumentation cannot be passed.
3. Problems that need to be paid attention to in the calculation of the balance of EOD project funds
(1) Grasp the relationship between the benefits of EOD projects and the ecological industry
According to Circular No. 40 of 2021, social capital can obtain benefits from ecological protection and restoration in the following ways: "adopt the method of ecological protection and restoration + industry introduction, and use the right to use natural resource assets or concession rights obtained to develop suitable industries;Apply for certified carbon sink increment and trade the ecosystem formed by investment with carbon sink capacity and meeting relevant requirements;Obtain benefits through the comprehensive utilization of resources approved by **". Therefore, the right to use natural resources, water rights, forest rights, carbon sink rights, concession rights, etc. can all be used as the income of the project, but the most important income is the income of the project industrial operation.
The related industry projects of the EOD model should belong to low-carbon ecological industry projects, have a strong dependence on good ecology, and have an intrinsic relationship with ecological governance projects to promote integrated development, so the attributes of related industries should be fully considered when doing industrial planning and income calculation, rather than blindly ** some high-yield projects. Low-carbon ecological industries are commonly used in (1) ecological agriculture, cultural tourism, health care and other ecological industry development projects;(2) Development and construction projects of environment-sensitive industrial agglomeration areas such as green parks, ecological industrial parks, high-end intelligent equipment, digital economy, clean medicine, and electronic components;(3) Clean energy projects such as "photovoltaic +" and biomass energy utilization.
In order to ensure that the EOD project can achieve a balance between project input and output, the following requirements should be fully considered for the planned related industrial projects: the industrial projects should comply with the national and local industrial policies, spatial control and other policy requirements;Secondly, the planned industrial projects should have a certain industrial development foundation and meet the requirements of local resource endowment and economic developmentThirdly, it is necessary to have good development prospects and good output benefits, and meet the requirements of financial institutions for project operation incomeFinally, it is necessary to meet the requirements of the internal logical relationship of "close linkage, full integration, clear boundaries, and return of benefits" of EOD projects.
(2) Problems that should be paid attention to in the practical operation of the "income**" of the EOD project
The regulatory authorities clearly stated that the EOD model is an "innovation" on the basis of "integrity", and local implicit debt is also a "red line" that cannot be touched in the development of EOD projects. In the EOD project, it is necessary to achieve the goal of effectively improving the quality of the ecological environment and achieving better development of the industry under the premise of no investment. To this end, the following key points should be paid attention to when calculating the project income: First,The benefits should be comprehensiveIn addition to the operating income of the industrial project, the income generated by the environmental governance project itself and the rights and interests entitled to be obtained in the process of environmental governance can be used as the income of the project, and the economic benefits within the scope of environmental governance should also be fully internalizedThe second is,The results of earnings should be compactedThe calculation results of each income should not only have a reference basis, such as land transfer, housing lease, tourism income, commodity sales income, etc., but also be scientific and true;The third is,Earnings must be obtainedThe acquisition, use or income of rights and interests in natural resources, mineral resources, concessions, etc., must comply with legal and compliant procedures and substantive requirements.
The following issues should also be paid attention to in the specific calculation:
1. The key to consider the operating cost of the project
The project operating cost here refers to the operating cost excluding project depreciation and amortization and financial expenses. There are two estimation methods: (1) consider the environmental treatment project and related industry projects as a whole project, and calculate the raw material costs, fuel and power costs, wages or salaries, maintenance costs, management costs, and other expenses (such as land rent) of the project as a whole. If the sub-project of the EOD project involves cooperative development with the collective economy (it needs to be made clear that the collective economic cooperation organization does not participate in the operation and management of the project and only enjoys the income dividend of the project), the income share of the village collective economic organization should be deducted from the calculation. (2) If the operating cost of the project is considered for the molecular project, the operation and maintenance cost of the environmental treatment project should be calculated on the one hand, and the operating cost of the related industry project (business project) itself should be considered on the other hand, and the operating cost of each sub-project can be estimated with reference to method (1).
2. The key to consider in the estimation of project operation income
The estimation of project operating income should be cautious, reasonable and evidence-based, which can be considered from the following aspects: (1) The estimation of project operating income must have market reference standards (market research, data search, on-site visits, etc.), and the standard of operating income must have reference data or basis for the same type of project, otherwise it is difficult to judge the accuracy and stability of income. For example, photovoltaic power generation projects need to implement clear indicators for power generation and grid accessFeed-in tariff** and basis;Installed capacity, effective sunlight time, attenuation rate, etc., related to annual power generation. (2) The operation capacity and scale of the project should be reasonably determined by considering the local market capacity and relying on the existing market and industrial base, and cannot be "patted on the head". (3) The full load rate of operation needs to be determined in combination with the local industrial development plan and the actual investment capacity, and it takes time and influence for the project operation income to reach stability. (4) If the project has potential customers, it can provide volume and price agreements, framework agreements, letters of intent, etc. as supporting materials in accordance with the requirements of relevant industries.
3. Compliance issues that should be paid attention to when state-owned assets and resources are involved in operating income
1) Projects involving the disposal of sand and gravel resources.
Document No. 10 of 2023 of the Natural Resources Office clarifies that "where the remaining waste soil and stone materials are involved in external sales, they shall be included in the public resources trading platform by the county-level people's ** organizations for sale, and shall not be directly sold by the project undertaking unit, construction unit or individual;."The proceeds from the sale shall be included in the people's financial account at the same level, and all of them shall be used for the ecological restoration of the region, and the reasonable income shall be guaranteed if the social investment entity undertakes the restoration project". Based on this, the disposal path and method of river sand, sand and gravel, waste soil and stone and other resources involved in the EOD project have been clarified, and the river sand, sand and gravel, waste soil and stone and other resources generated during the implementation of the project can be used for the project by the implementation entity according to the approved utilization plan, which will be included in the construction cost of the project and offset the project construction investmentIf there is any surplus, it will be disposed of in accordance with the procedures in accordance with laws and regulations, and the proceeds from the sale shall be included in the financial account of the people at the same level, and all of them shall be used for ecological restoration in the region. Accordingly, the revenue from the sale of the relevant natural resources can no longer be counted as the revenue of the EOD project**, and it is important to note that it is important to take note when calculating it as a whole.
2) Projects involving land index transactions.
According to the State Council of the People's Republic of China (2021) No. 40, "after the social capital restores the construction land in the restoration area to agricultural land and passes the acceptance, the surplus index can be transferred and used within the provincial scope in accordance with the policy of linking the increase and decrease of urban and rural construction land", and "the rights and interests related to the use of land and sea areas obtained by social capital investment and restoration in accordance with the law can be transferred in accordance with laws and regulations and obtain corresponding benefits after the restoration task is completed". Therefore, the new cultivated land index or drought-to-water index (hereinafter referred to as the "supplementary cultivated land index") formed by the EOD project can be transferred and traded in accordance with laws and regulations and obtain corresponding benefits after the restoration task is completed.
The specific implementation path is as follows (for reference only):
The project company of the EOD project will hand over the supplementary cultivated land indicators developed during the implementation of the project to the local government, and the local government will issue a document clarifying that after the above supplementary cultivated land indicators are traded in the trading platform system, the index transaction income will be processed in two parts: if it is used to cover the investment cost and reasonable income of the ecological restoration entity, it will be collected by the supplementary cultivated land index trading platform and transferred to the ecological restoration entity (project company). If there is still residual income, it shall be handed over to the local finance for unified disposal. For example, an EOD project is expected to generate 22,000 acres of supplementary cultivated land. It is estimated that after completing the transaction of 22,000 mu of supplementary cultivated land, the local government needs to use the transaction income to cover 21 of the investment costs and reasonable returns of the main body of ecological restoration5.6 billion yuan (the average transaction income per mu of land index needs to be paid 9.)80,000 yuan) will be collected by the supplementary cultivated land index trading platform, and transferred to the payment ecological restoration entity (project company), and this part of the income can be used as the income of the project**.
3) Projects involving sewage treatment plants.
If the EOD project involves the construction of a sewage treatment plant, it needs to be considered in different situations: if it is a sewage treatment plant in an industrial park, the project implementation entity shall collect sewage treatment fees from the pollutant discharge enterprise, and the project implementation entity shall operate independently and bear its own profits and losses, and this part of the sewage treatment fee shall fully meet the requirements of the operating income of the EOD project;If it involves rural domestic sewage and urban domestic sewage treatment plants, this part of the sewage treatment fee generally needs to be subsidized, or it is collected and then transferred to the sewage treatment plant, this part is more complicated, and whether it is determined that there is a ** operating subsidy is controversial, it is not recommended to be included in the implementation scope of the EOD project, and the sewage treatment fee is not recommended to be used as operating income.
To sum up, in the process of EOD project planning and packaging, we should do a good job in the early stage of project research and market research, reasonably determine the construction investment of the project, fully consider the project operating costs and inputs, and try to achieve sufficient calculation basis in the case of income in line with policy requirements and storage conditions, and the income is diversified, feasible and relatively stable. 