China’s efforts to reduce its horrific pollution are creating a new problem: fraud. To clear its smoggy skies, China put in place green incentives for power plants, but many plants cheated that system by claiming to have cut down on emissions without actually doing anything. Now, as Reuters reports, the Chinese government is cracking down on these swindling power producers:
On Tuesday, [China’s National Development and Reform Commission (NDRC)] issued a notice saying that firms engaging in fraud to qualify for subsidies would face severe penalties and suffer public exposure.The firms were exploiting a scheme that paid a higher price for power sold to the grid by power plants that had installed expensive equipment to cut pollutants such as sulphur dioxide and nitrogen oxide.The NDRC said the probe showed many power firms had failed to install equipment properly, falsified emissions data or tampered with automatic emission sensors to trick authorities into granting the subsidy.
This isn’t the first time green schemes have been revealed as particularly vulnerable to fraud. Here in the US, con artists have repeatedly taken advantage of a system designed to encourage the production of biofuels. In Italy, the mob has lots of green dirt on its hands. Green policy initiatives are evidently fertile soil for such chicanery.But in China, where the central government already has well known trouble in getting local governments to submit accurate data, this problem will be especially persistent and is probably much worse than what we already know. That’s unfortunate, because China’s toxic smog is exacting a heavy toll on both the economy and on public health.