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A Silver Lining in Beijing Smog: Soaring Pollution Penalty Revenues

Tiananmen Square during severe pollution on Feb. 25 in Beijing

Photograph by Lintao Zhang/Getty Images

Tiananmen Square during severe pollution on Feb. 25 in Beijing

Looking for a silver lining in Beijing’s gray smog? The city’s environmental protection bureau says fees collected from polluters are soaring, already totaling 88 million yuan ($14 million) this year. That’s way up from 8.34 million yuan in penalties levied over the same period last year, according to the China Daily.

The surge in penalties isn’t because the smog’s been worse. In January, the fines went up more than 10-fold for major pollutants, including sulfur dioxide, nitrogen dioxide, and ammonia nitrogen.

The higher fees are already helping encourage companies to retire some of their worst habits. “Many companies used to ignore the old discharge fee because it was simply too insignificant,” said Zhong Chonglei, head of the Beijing Environmental Monitoring Team, at a press conference on May 6. “The increased fee has made many companies realize the importance of emission reduction.”

A good chunk of the fines is coming from coal-fired power plants and cement plants, making up 21 percent of the 88 million yuan total, according to the bureau. To bring down emissions and lower their penalties, Beijing’s four biggest coal-fired plants have started to install purification devices. In the first quarter, they have used 2.6 million metric tons of coal, 200,000 tons less than in 2013, reports the China Daily. “All the money collected will be used to improve the city’s air quality,” said the bureau’s Zhong.

Roberts is Bloomberg Businessweek's Asia News Editor and China bureau chief. Follow him on Twitter @dtiffroberts.

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