Three regions, three different directions — January 2026
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Recent developments point to a widening gap between jurisdictions moving forward on carbon market infrastructure and those pulling back from international frameworks. In China, the finalized GEC regulation and the Singapore-Vietnam bilateral methodology list both carry direct procurement implications for buyers active in Asian carbon and renewable energy markets. In the US, the UNFCCC withdrawal and the 45Z NPRM are pulling in different directions on clean fuel and carbon markets. In Europe, the revised Automotive Package preserves post-2035 demand for bio-LNG and biomethane — a more durable signal for renewable fuel suppliers than the previous framework allowed. Read on to discover what these policy developments mean for you.
Published on 23rd January 2026.
China and Singapore: market infrastructure developments with direct procurement implications
What happened
China published the official Management and Implementation Regulation for its Green Electricity Certificate (GEC) market in January 2026. The regulation covers the full GEC lifecycle, including asset registry, issuance, trading, and cancellation. Notable changes from the draft framework include expanded eligibility for cross-border grid-connected generators and electricity users with physical power exchange adjacent to China, including entities in Hong Kong and Macau. The regulation also introduces provincial-level GEC accounts for statistical monitoring and clarifies that same-calendar-year matching between generation and consumption is required for GEC cancellation.
Separately, China's People's Bank published the national standard GB/T 46912-2025, "Environmental, Social and Governance Assessment Framework for Bond Issuers," which takes effect on 1 April 2026. The framework establishes a three-tier structure covering environmental, social, and governance categories across 11 dimensions and 33 assessment topics.
In the same period, Singapore published its pre-approved list of carbon credit methodologies eligible under its bilateral implementation agreement with Vietnam. The list covers methodologies that will qualify for Article 6-aligned transfers between the two jurisdictions.
What it means for your business
The GEC regulation is a significant milestone for companies procuring renewable energy certificates in China. The expanded scope to include cross-border generators and the retirement function on trading platforms both affect procurement strategy for multinationals operating within or adjacent to the Chinese grid. The calendar-year matching requirement for cancellation is an operational constraint that sourcing teams need to account for in annual planning cycles.
The ESG bond issuer standard signals a broadening of China's disclosure requirements into the financial sector. For companies with bond issuance activity or counterparties in Chinese capital markets, this adds a reporting layer aligned with ESG categories that will affect portfolio management from April 2026.
The Singapore-Vietnam methodology list is directly relevant to buyers sourcing Article 6-compliant credits from Vietnamese projects. Only methodologies on the pre-approved list will qualify under the bilateral agreement.
Entry into force
China GEC regulation: in force.
China ESG bond standard (GB/T 46912-2025): 1 April 2026.
Singapore-Vietnam methodology list: published and in effect.
Further reading
China GEC regulation: nea.gov.cn
Singapore-Vietnam methodology list: carbonmarkets-cooperation.gov.sg
United States: federal rollback creates market uncertainty for clean fuels and carbon frameworks
What happened
In January 2026, the US formally withdrew from the UNFCCC and 64 other international organizations, treaties, and conventions. The White House cited conflicts with US sovereignty and economic interests as the stated rationale. Separately, the US Department of the Treasury issued a Notice of Proposed Rulemaking (NPRM) to provide implementation guidance for the Section 45Z Clean Fuel Production Credit, covering emissions factor calculations, credit determination methodology, and registration requirements. A further budget proposal introduced provisions relating to E15 ethanol blending requirements and Small Refinery Exemption (SRE) reform under the Renewable Fuel Standard (RFS).
What it means for your business
The UNFCCC withdrawal removes the US from the international carbon market frameworks established under Article 6. Companies with US-based supply chains or counterparties operating in Article 6 jurisdictions face increased regulatory asymmetry. US states and major corporates remain committed to climate targets, but the federal withdrawal raises scrutiny on US-origin instruments in cross-border transactions.
On the fuels side, the 45Z NPRM affects pricing dynamics in RIN and LCFS markets, production margins in biodiesel, the value stack for RNG, and the emerging trade flow of RECs to biofuel producers. The E15 and SRE provisions carry direct implications for Renewable Volume Obligation (RVO) levels and RIN market volatility. SRE announcements have historically been among the most impactful drivers of short-term price movement in the RIN market.
Entry into force
UNFCCC withdrawal: confirmed January 2026.
Section 45Z NPRM: rulemaking in progress, guidance expected ahead of the credit's 2025-2027 eligibility window.
E15/SRE provisions: legislative process ongoing, 2026 implementation proposed.
Further reading
White House Executive Order, January 2026: whitehouse.gov
Section 45Z NPRM: reginfo.gov
Europe: EU Automotive Package confirms post-2035 role for renewable fuels
What happened
The EU published its Automotive Package in January 2026, revising the 2035 vehicle CO2 reduction requirements. Rather than requiring 100% tailpipe emissions reduction, the package allows carmakers to meet part of their obligations through flexibility mechanisms: fuel credits linked to verified greenhouse gas savings from renewable fuels used in road transport (capped at 3%), and credits for low-carbon steel used in vehicle manufacturing (capped at 7%). Eligible fuels include RFNBOs, biofuels including bio-LNG, and biogas/biomethane. Fuel credits are calculated centrally by the Commission based on the renewable fuel mix in road transport and cannot be traded between manufacturers.
What it means for your business
This is a material policy change for the renewable fuels supply chain. The previous 2035 framework would effectively have removed regulatory relevance for all road transport fuels, including renewables. The revised framework formally embeds bio-LNG, biomethane, and other eligible fuels in the EU's automotive compliance regime beyond 2035. While the 3% cap limits the scale of the fuel credit mechanism, it preserves post-2035 demand and a durable regulatory signal for renewable fuel supply into road transport.
Entry into force
Framework target date: 2035.
Fuel credit mechanism details subject to Commission calculation methodology, to be established ahead of implementation.
Further reading
EU Automotive Package: details available via the European Commission.
Disclaimer
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