Huaneng Design Institute
Design consulting EPC general contracting project supervision and other whole process professional service institutions
From June 1, the energy sector will start franchising
The "Measures for the Administration of Infrastructure and Public Utilities Franchising" (hereinafter referred to as the "Measures") was recently adopted by the executive meeting of the State Council and officially implemented on June 1. The "Measures" clearly encourage and guide the implementation of five major areas of franchising: energy, transportation, water conservancy, environmental protection, and municipal engineering.
Li Pumin, secretary-general of the National Development and Reform Commission, introduced at a press conference that the franchise of infrastructure and public utilities is an important reform and institutional innovation, which is conducive to expanding private investment, stimulating social vitality, and increasing the supply of public goods and services.
"It has been more than 30 years since the concession of Shenzhen Shajiao B power plant project was implemented in 1984. Over the past 30 years, a large number of concession projects have been launched in various places, and the relevant departments of the State Council and relevant provinces and cities have formulated more than 60 local regulations, rules or normative documents." Li Pumin said.
According to incomplete statistics from the World Bank, since the 1990 s, my country has organized more than 1000 franchise projects in the fields of transportation, energy, and municipal administration. According to preliminary statistics, the proportion of urban sewage treatment and public water projects in China has reached 42% and 20%.
Although franchising has achieved some results, in practice, market players reflect some problems that need to be solved urgently. "There is a lack of unified institutional norms at the national level, an imperfect mechanism to protect the rights and interests of private investment, and cumbersome administrative approval procedures. These problems affect the enthusiasm of social capital participation and restrict the healthy development of franchising." Li Pumin said.
"In order to reduce the burden on franchisees, ensure the implementation of projects as soon as possible, and promote the transformation of government functions, the" Measures "have grasped a very important starting point and goal, that is, no new administrative approval procedures or approval links for market entities." Li Kang, director of the laws and regulations Department of the National Development and Reform Commission, said that the government can give necessary financial subsidies according to the agreement and simplify the procedures for planning and site selection, land use and project approval.
"In the next step, our committee will work with relevant departments to implement the" Measures "and conduct supervision and inspection of local implementation in due course." Li Pumin said.
In addition to emphasizing that administrative examination and approval should not be illegally increased in the name of franchising, the measures also improve the franchise price and charging mechanism, policy and development financial institutions can provide differentiated credit support, and the loan term can be up to 30 years.
Infrastructure investment cycle is long, the risk is high, and the amount involved is very large, so it needs the strong support and cooperation of financial institutions.
"Articles 17, 23 and 24 of the Measures all propose a number of specific financing policies." Li Kang introduced that in the first paragraph of Article 17, financial institutions are encouraged to jointly formulate investment and financing plans with legal persons or other organizations participating in the competition. Article 23 provides for innovative credit methods and credit policies, gives differentiated credit support to franchise projects, explores the use of project expected income pledge loans, and supports the use of related income as a source of repayment. Article 24 provides for supporting the financing of securities for franchise projects, encouraging the provision of capital for franchise projects through the establishment of industrial funds and other forms of equity participation, and also encouraging the establishment of private equity funds for franchise projects, the introduction of strategic investors, and the broadening of financing channels through the issuance of corporate bonds.
In view of the large investment in energy projects and the long return period, "market players can jointly bid for energy projects, each with its own strengths, and gather its own advantages to participate in the competition." Li Kang said, "As long as the statutory procedures and conditions are met, future investment entities and equity changes are also possible."
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