China pilots trans-provincial eco-compensation scheme (2)

Wang Jiaquan, director of the Anhui Provincial Ecological Engineering Technology Institution, suggested creating a pollution management plan that targets individual watersheds.

Such a plan was put into place on a trial basis on the Xin'an River in 2012. The river, which originates in the city of Huangshan in Anhui, runs into Qiandao Lake in Zhejiang. The lake is the main source of drinking water for Zhejiang and acts as a strategic reserve reservoir for the Yangtze River Delta.

According to an agreement between the two provinces, Anhui must compensate Zhejiang if excessive pollutants are detected downstream. However, downstream cities in Zhejiang must compensate Anhui if their water quality is greater than required.

Huangshan and other cities in Anhui have subsequently been reluctant to allow industrial development to take place, as they do not wish to see the Xin'an River become polluted.

Lu Haining, environmental protection chief of Huangshan, said the plan has helped improve the watershed's environment.

The mutual compensation mechanism will not only ensure water quality in downstream areas, but also ease a scarcity of capital in Anhui and alleviate the contradiction between economic development and environmental protection.

Lu said the compensation mechanism has some limitations.

"The compensation should not only be directed at pollution treatment costs. It should also cover the cost of the development opportunities lost (by Anhui) in the process of protecting the environment," Lu said.

Lu said there is no state-level legal documentation or support system for the mechanism.

"But the trial has been successful for the past year. More time is required in order to learn from the trial," Lu said.

The Chinese government plans to allocate 500 billion yuan for the prevention and control of water pollution in major drainage areas from 2011 to 2015, up from 300 billion yuan for the previous five-year period, according to a 2011-2015 guideline on fighting water pollution that was released last year.

The government's focus has shifted to more elaborate methods of water management, as well as coordinated prevention and control efforts, according to the guideline.