An instrument for improving the Chinese environment: transparency

  “Transparency in China: Implications for the Environment and Climate Change” by Barbara Finamore of the Natural Resources Defense Council’s (NRDC) China Program outlines the use of transparency as an environmental policy in China.   I assume the U.S. has particular interest in these issues given the stumbling block of verifiability at Copenhagen. The following summarizes Finamore’s  discussion.

 Importance of Transparency.  Open information mechanisms reduce pollution and improve human health by driving better environmental protection. Their first application was the Toxics Release Inventory (“TRI”), established in 1986 in the U.S. in the aftermath of the Union Carbide chemical accident in Bhopal. In the past decade, signatories to the  Aarhus Convention ratified open information as a tool for environmental protection and subsequently created the Protocol on Pollutant Release and Transfer Registers to the Aarhus Convention, which established the rules for TRI-like systems in  Aarhus signatory countries.

China’s Recognition of the Importance of Environmental Information.  China has begun to look to environmental information disclosure to improve environmental protection. Its leaders recognize that open information is an important way to bring a variety of stakeholders –members of the public and businesses – into its environmental protection efforts, and to improve the quality of information needed for environmental targeting. Environmental transparency can also assist overextended environmental agencies.

I. China’s Actions to Increase Environmental Transparency. China has made a number of important moves towards greater transparency in general and environmental disclosure in particular.

Open Government Information Regulations.  On May 1, 2008, China’s first national regulation on freedom of information went into effect. The Open Government Information Regulations (“OGI Regulations”) was a landmark. This was driven by the understanding that greater transparency will benefit economic development, curb corruption, improve government performance and improve people’s lives.

Environmental Information Disclosure Regulations.  China’s Ministry of Environmental Protection (“MEP”) has been an enthusiastic adopter of information disclosure as a regulatory tool. MEP was the first ministry to promulgate implementing measures for the national OGI Regulations, and issued environmental information regulations on the same day as the OGI Regulations. These environmental information regulations, called Measures for Environmental Information Disclosure (For Trial Implementation) (“Environmental Information Measures”), set forth environmental information disclosure obligations for environmental protection departments and certain enterprises throughout China.

 The enactment of the OGI Regulations and the Environmental Information Measures in 2008 arose from more than a decade of local experimentation with government disclosure and open environmental information. China has incrementally instituted various forms of environmental disclosure at both the central and provincial level since the late 1990s: 

• In 1998, a pilot project, called the GreenWatch Program, was instituted in Jiangsu Province with guidance from the World Bank that established a rating system for factory-level environmental performance. The State Environmental Protection Agency (“SEPA”), the predecessor to the Ministry of Environmental Protection, subsequently issued non-mandatory guidance encouraging nationwide implementation of this rating system in all provinces. Where implemented, this system has often been an important tool for identifying polluting enterprises across sectors in different provinces.
• Since 2002, more than 30 provinces and municipalities across China have enacted “open government information” legislation.
• The 2003 Clean Production Promotion Law (and the related 2004 Interim Measures on Clean Production Audits) required key polluting enterprises to disclose information about emissions and other environmental data. This was the first law to require disclosure of factory-level pollution for a range of facilities.
• The 2003 Environmental Impact Assessment Law (and the related 2006 Measures on Public Participation in Environmental Impact Assessment) required partial public disclosure of Environmental Impact Assessment (“EIA”) documents.
• In 2005, a key State Council document, entitled the Decision on Implementing Scientific Development Outlook and Enhancing Environmental Protection, which set forth guiding principles on environmental protection, stressed the importance of environmental information disclosure, public supervisory mechanisms, and disclosure of enterprise violations of environmental standards, among other things.

The Environmental Information Measures of 2008 built upon these experiments in information disclosure. They require environmental protection bureaus to disclose environmental information and to respond to public requests for environmental information. In addition, these regulations require that certain enterprises, whose emissions have exceeded national or local emission standards or exceeded total emissions quotas, disclose information such as the volume of pollution emitted by their operations that exceeds prescribed limits.

II. How is Access to Environmental Information Being Implemented?  Under the Environmental Information Measures, environmental protection departments at the national, provincial, municipal and city levels are required to comply with various environmental information disclosure obligations. Environmental protection departments are now required to proactively disclose, inter alia, information concerning:

• Environmental quality status, environmental statistics and environmental investigative information;
• Allocation of total emission quotas of major pollutants and their implementation;
• Issuance of pollutant emission permits;
• Acceptance of EIA documents for construction projects and the examination and approval status of the EIA documents;
• Collection of pollutant emission fees and amounts paid by polluters;
• Letters, calls and complaints from the public about environmental issues or pollution caused by enterprises;
• Environmental administrative penalties, administrative reconsideration, administrative lawsuits and enforcement of administrative compulsory measures;
• Lists of heavily polluting enterprises, enterprises that have caused serious environmental pollution accidents or events, and enterprises that refuse to enforce environmental administrative penalty decisions.

Environmental protection departments must respond to requests for information within 15 working days of receiving them. These disclosure obligations are subject to certain exceptions such as state secrets, commercial secrets and personal privacy.  In addition, if applicants believe the administrative agency has failed to fulfill its obligations under the regulations, they may report it to a higher-level administrative agency. If applicants believe the administrative agency has infringed their lawful rights and interests, they may apply for administrative reconsideration or file an administrative lawsuit.

These legal requirements regarding disclosure of environmental information are a significant step forward. However, the key lies in how effectively the measures are implemented.

 Study on Environmental Information Disclosure.  NRDC partnered with the Institute of Public & Environmental Affairs (“IPE”), a Chinese research institute, to track the progress of implementing the Environmental Information Measures since they became effective in 2008.  NRDC and IPE studied 113 municipal environmental protection departments to assess progress in implementing these regulations. After the first year of implementation, our assessment shows that average compliance levels were low. Nonetheless, a number of cities performed well. The study also uncovered a surprising range of innovative practices in information disclosure that can serve as a model for underperforming cities.

 a. Disclosure of Environmental Information in Practice.  Different cities are meeting their information disclosure requirements in various ways.

 Ningbo, in Zhejiang province, ranked the highest in terms of its overall performance on environmental disclosure. In 2008, Ningbo disclosed more than 600 documents regarding environmental enforcement and enterprise violation records on its website and did so in a timely manner. Ningbo also has released all environmental complaints filed in sufficient detail and included the status of each complaint. In response to citizen concerns about emissions from area factories, the environmental protection bureau in Ningbo’s Zhenhai district took steps to improve environmental transparency, including releasing information on emissions of five pollutants not currently covered by any standards, establishing a public information display that lists monthly emissions data alongside the applicable standards, working with enterprises to improve monitoring, and holding quarterly briefings to respond to questions from area residents and news media. Zhenhai’s environmental officials noted that although these efforts increased their work, they helped to resolve concerns from citizens at an early stage so as to avoid conflicts and increased the level of trust between citizens and government.

 Weihai, a city in Shandong province, captures real-time monitoring data for key enterprises and water treatment plants across the city, and discloses a monitoring database that provides daily reports with detailed hourly data. According to our research, the frequency of this reporting is the highest in the country.

 Wuhan, a city located in Hubei province in central China, created a website that provides the public with searchable emissions data for a given day or time period. On this website the public can choose a point source, and then select the pollutant to be tracked for a selected time period. In addition, the website also provides real-time video of the waste treatment facilities, discharge pipes, or emission stacks at certain sites.

 Fuzhou, in Fujian province, has set up an online “Call Center” database that allows the public to make various information requests to the Mayor and tape recordings. The website will post the public inquiry and the results will be handled by the corresponding department. The public is also able to search the information by time, type of appeal, and processing status.

Hefei, a city in Anhui province, in response to our request for information, publicized on its website a list of enterprises in violation of rules and standards during September 2008 and provided related links so that the list could be accessed by the public.

b. Responsiveness to Information Requests.  Members of the public have begun to make information requests pursuant to the Environmental Information Measures. For instance, a Shanghai lawyer sought government information regarding the severely polluted Huai River. The lawyer contacted the provincial environmental protection bureaus in both Henan and Anhui provinces to retrieve the names of the enterprises that were polluting the river. The lawyer succeeded in obtaining information, and he is considering litigation against those factories  violating environmental regulations.

The yearly reports that environmental authorities are required to prepare regarding their open government information work for the previous year provides some idea of the number and type of information requests received. At the central level, the MEP received 72 requests for information in 2009, mainly concerning EIA, environmental monitoring data, and environmental laws and regulations. Seventy-one of these requests were timely answered, while the remaining one request was answered after an extension of time. The requested government information was not disclosed for four of the requests. In the city of Guangzhou in Guangdong province, the environmental protection bureau received 17 requests for information in 2009, relating to issues such as EIA, environmental monitoring data, and environmental administrative penalties.

Obstacles to Greater Compliance. The responsiveness of environmental protection bureaus to public information requests and their proactive disclosure of environmental information have varied widely across the country. There are currently three obstacles to compliance with the environmental information disclosure measures: (1) a lack of capacity, (2) vagueness of regulations, and (3) insufficient accountability for government officials.

 Lack of Capacity. Many lower level officials do not understand or are unaware of the regulations and are ill-equipped to collect information needed. Progress should occur as environmental officials obtain more experience and training in dealing with information requests. There is a significant opportunity to improve information disclosure through enhanced training and education.

 Vagueness. Another obstacle is a lack of clarity regarding the scope of disclosure as well as the permissible exceptions, such as commercial secrets, personal privacy and state secrets. In November 2009, the Supreme People’s Court (“SPC”) issued a draft judicial interpretation to clarify the regulations and solicited public comment on this interpretation. A variety of stakeholders (including NRDC) have provided suggestions on how to clarify these regulations, and we are hopeful that the SPC interpretation when it is ultimately released will provide a boost to information disclosure. MEP can also play an important role in clarifying the scope of information disclosure by developing implementation guidelines for the Environmental Information Measures as soon as possible.

Accountability. Another obstacle is that local officials are not consistently held accountable for failing to comply with their disclosure obligations. However, there have been a handful of cases in which refusals to disclose were successfully appealed. In addition, there are efforts to hold officials accountable for their performance in meeting their information disclosure responsibilities. For example, according to a recent news report, after administrative departments in Shijiazhuang city in Hebei province were found to be violating their responsibility to disclose information, city leaders announced that performance in meeting information disclosure requirements would be included in the performance assessments of city officials. The expansion of such practices around the country is critical to implementation of the open information regulations.

Although there is still much work to be done to improve environmental transparency, progress is significant. China is still at the earliest stages of implementing its landmark OGI Regulations and Environmental Information Measures, but these have the potential to be transformative.

III. Conclusion.  Given the pace and scale of change, China will constantly be faced with choices that have dramatic and fundamental significance for the future direction of the country. The trend has been toward ever-greater openness in the environmental realm and there are reasons to believe that this will continue; however, the choices made on-the-ground in China in the coming years on how to deal with the implementation challenges will mean the difference between a transparency system that truly helps China to achieve its environmental and climate change objectives or a system that exists mainly in the law books, but not in practice.

 The main reason to believe that the trend towards greater transparency will continue is that transparency is viewed by many as an effective tool for solving serious environmental and energy challenges. Environmental authorities recognize that environmental transparency can bring in local communities and other members of the public as powerful allies in the enforcement of environmental regulations. Greater transparency is enabling a wide range of efforts to strengthen environmental protection that are now getting off the ground. These include efforts by corporate purchasers to “green” their supply chains in China, initiatives to meet consumer demand for cleaner, healthier products, “green credit” efforts to limit loans to serious polluters, and of course the most basic of demands from local people for cleaner, more sustainable communities.

Transparency has also been utilized in the energy realm to promote implementation of China’s climate change and energy efficiency effort. China has, for example, disclosed the performance of provinces against their interim energy intensity targets in an effort to drive greater competition among jurisdictions. China has begun to develop carbon exchanges and other efforts to monetize greenhouse gas reduction efforts, but these nascent efforts will be hampered if the business community and the public do not believe they have access to quality information. Greater transparency also has the potential to spur competition among companies within China to perform better than their peers in meeting government energy targets.