Beijing invents valuation standard for ecological assets

Beijing has for the first time announced its comparable GEP-R (value of ecological product regulatory services), valuing these essential natural benefits in 2024 at 373.8 billion yuan ($52.41 billion). The figure marks a key outcome of the city's innovative approach to quantifying the value of a healthy environment.

The announcement comes on the 20th anniversary of establishing the principle that lucid waters and lush mountains are invaluable assets.

All districts have achieved year-on-year growth in their comparable GEP-R figures, said Liu Baoxian, deputy head of Beijing Municipal Ecology and Environment Bureau, attributing the upward trend of Beijing's GEP-R to its stable ecological spaces and continuous restoration efforts.

According to Li Xiaotao, deputy head of the Beijing Municipal Commission of Development and Reform, the initial challenge had been establishing a standard method to quantify nature's value, but Beijing addressed this by creating a local GEP accounting standard in 2022, becoming China's first province-level region to complete such calculations the following year.

Yanqing district, an early adopter, implemented 10 detailed measures to increase the value of its natural capital. Grassroots initiatives flourished, from villages awarding merits for green actions to communities banding together to create an outdoor park, which improved the environment and brought migrants back to start businesses like homestays.

Beijing has also pioneered a nationwide innovation by establishing a "swap and compensation" mechanism between GEP-R and GDP.

Through a groundbreaking district-to-district eco-compensation mechanism initiated this year, Yanqing "earned" 53.31 million yuan from Haidian district this year.

Districts that exceed their GEP-R growth targets receive payments from those that fall short, turning ecology into a tangible asset, Li explained, adding that seven eco-conservation districts received compensation from this district-to-district mechanism this year.

Now, the city's eco-conservation efforts are also translating into tangible economic benefits for local residents. In Miyun district, honey produced under strict ecological certification commands a premium, with prices rising from 20 yuan to 49 yuan per kilogram. In Mentougou district, a former mining area, villages are transforming into eco-towns, with residents becoming shareholders in tourism projects. One project is expected to generate 35 million yuan in revenue.

Last year, the per capita disposable income of Beijing's rural residents approached 40,000 yuan, and the urban-rural income gap narrowed from 2.51:1 to 2.32:1.