[Chinese Mainland] Haikou Implements Differentiated Wastewater Treatment Charges: Environmental Credit Rating Directly Determines Wastewater Treatment Fee Standards

Key Highlights: The Haikou Municipal Development and Reform Commission and the Haikou Municipal Water Affairs Bureau have jointly issued the "Opinions on Implementing a Differentiated Wastewater Treatment Fee Mechanism in Haikou," effective from 2026年8月1日. This mechanism directly links enterprises' environmental credit evaluation ratings with wastewater treatment fee standards. Annual evaluation results take effect from the month following publication; where fee mismatches occur due to evaluation errors, refunds or offsets may be processed after verification. A supporting tripartite periodic reconciliation mechanism among water affairs, finance, and collection units has been established, and unauthorized deferral, reduction, or exemption of fees is strictly prohibited.

I. Core of the Mechanism: Turning a Regulatory Tool into a Price Signal

For a long time, urban wastewater treatment fees have been a typical "one-size-fits-all" public utility price—within the same area, regardless of whether an enterprise's discharge behavior is good or bad, whether pretreatment is adequate, or whether discharge concentrations are high or low, the fee standard is basically the same. Price only serves the function of "compensating operating costs," not "guiding discharge behavior."

Haikou's opinion changes this logic. Its core design is: based on the Hainan Province Enterprise and Institution Environmental Credit Evaluation Results, implement differentiated wastewater treatment fee standards for enterprises with different credit ratings, allowing water prices to float with discharge performance.

The ingenuity of this design lies in the fact that it moves a regulatory tool originally used only for "post-hoc penalties and public disclosure" forward to become a perceptible, predictable, and improvable cost variable in enterprises' daily operations. Enterprises with high credit ratings reduce their water costs, while those with low ratings bear higher expenses—incentives and constraints are completed on the same bill.

II. Implementation Rules: A Complete Closed Loop from Evaluation to Fee Collection

The opinion provides clear provisions on implementation details, forming a complete closed loop from "evaluation" to "fee collection" and then to "correction":

• Effective timing—Annual evaluation results take effect **from the month following publication**, with a validity period consistent with that of the credit evaluation results, avoiding a mismatch window where "the evaluation has changed but fees have not."
• Objection and repair channel—Where enterprises have objections to credit evaluation results or apply for credit repair, procedures shall be strictly handled in accordance with the "Hainan Province Enterprise and Institution Environmental Credit Evaluation Management Measures."
• Mismatch correction—**Where fee mismatches occur due to evaluation errors, fee standards shall be adjusted promptly after verification in accordance with regulations, and refund or offset procedures shall be processed for the corresponding amounts due**; the refund and offset process shall be separately formulated by the municipal water affairs department together with the municipal finance department.
• Implementing entities and timing—Each wastewater treatment fee collection unit and entrusted collection unit shall implement differentiated charging when **reading water volume** the following month, and promptly remit the full amount to the special fiscal account.
• Rigid constraints—**No unauthorized deferral, reduction, or exemption** of the differentiated charging portion is permitted, and **the private establishment of transitional accounts to intercept or misappropriate** fee funds is **strictly prohibited**.

The provision that "mismatches may be refunded or offset" is particularly critical. Once differentiated charging is linked to credit, the cost of evaluation errors will be directly passed on to enterprises; establishing a clear error-correction and refund/offset path is the prerequisite for this mechanism to gain enterprise trust.

III. Supporting Supervision: Four Lines of Defense—Disclosure, Ledgers, Reconciliation, and Evaluation

To prevent policy distortion at the implementation level, the opinion establishes four lines of defense:

• Sunshine supervision—The municipal ecological environment department shall publicize credit evaluation results and dynamic adjustments in accordance with the "Hainan Province Enterprise and Institution Environmental Credit Evaluation Management Measures"; the water affairs department shall publicize differentiated charging standards and policy bases, and promptly publicize the overall implementation of fee collection; relevant departments shall simultaneously open supervision and reporting channels, proactively accepting oversight from society, discipline inspection and supervision, and audit departments.
• Ledger management—Each collection and entrusted collection unit shall establish **standardized ledgers** for differentiated charging, truthfully recording enterprise credit ratings, fee standards, and collection details, and implement **electronic plus paper archiving management**.
• Tripartite reconciliation—Establish a tripartite periodic reconciliation mechanism among the municipal water affairs, finance, and collection units to ensure accounts match reality and funds are fully remitted to the treasury; ledgers shall be subject to supervision and verification by audit and discipline inspection and supervision departments in accordance with law.
• Joint evaluation—The municipal development and reform department, together with ecological environment, water affairs, and finance departments, shall **periodically conduct joint evaluations**, comprehensively verifying policy implementation effectiveness, integrity risk prevention and control, and issues fed back by enterprises, as the basis for dynamic policy adjustment.

Regarding accountability, the opinion clearly states: staff members who commit disciplinary or illegal acts such as unauthorized adjustment of enterprise credit ratings, illegal reduction or exemption of additional wastewater treatment fees, tampering with ledger data, or interception and misappropriation of fee funds shall be seriously held accountable in accordance with regulations, discipline, and law; those suspected of crimes shall be transferred to judicial authorities for handling.

IV. Industry Significance: A Rare Sample of Wastewater Treatment Fee Mechanism Reform

Viewed against the national backdrop, the value of Haikou's exploration becomes even clearer.

First, it fills the refined gap of "user pays." In recent years, the direction of sewage treatment charging mechanism reform has been "dynamic adjustment, pay-for-performance, and cost recovery," but most regions still remain at the level of "raising rates." Haikou, by contrast, starts from horizontal differentiation—not an across-the-board price increase, but making enterprises with different performance pay different prices, resulting in less social resistance and a clearer orientation.

Second, it echoes "pay-for-performance." Some regions had previously incorporated indicators such as electricity consumption per ton of water and biogas recovery into the environmental credit rating of sewage treatment plant operators; Haikou's approach extends the consequences of credit evaluation to the polluting enterprise side, forming a two-tier pricing system of "operators pay for performance + polluters pay by credit."

Third, it provides pricing ideas for centralized wastewater treatment in industrial parks. Industrial agglomeration areas generally face the challenge of "large fluctuations in influent concentration, with individual enterprises exceeding standards and impacting the biochemical system." If differentiated charging is linked to indicators such as pretreatment compliance rate and characteristic pollutant concentration, the operational stability of centralized treatment facilities in parks will gain substantial economic safeguards.

Fourth, it is highly replicable. This mechanism does not rely on additional fiscal investment, nor does it require new engineering facilities. It only needs to connect two data interfaces: the "environmental credit evaluation system" and the "water utility charging system." For most regions that have already carried out enterprise environmental credit evaluation, the threshold for implementation is relatively controllable.

V. Three Practical Tips for Enterprises

• Pay attention to the evaluation cycle and effective time—after a credit rating change, charging is affected the following month. Enterprises should verify promptly during the public notice period of evaluation results to avoid passively bearing higher-tier rates
• Make full use of objection and credit repair channels—if there are objections to the evaluation results, apply for review or credit repair according to procedures; if overpayment is indeed caused by evaluation errors, apply for refund or offset according to regulations
• Treat pretreatment as a cost item and do the math—under differentiated charging, improving pretreatment facilities such as grease traps, equalization tanks, and segregated collection is likely to recover the investment through dual improvements in credit and concentration

From "uniform pricing" to "differentiated pricing," from "post-event punishment" to "pre-event guidance," the real highlight of Haikou's mechanism is not the level of rates, but that it proves water pricing can become a proactive tool for environmental governance. For regions currently advancing reform of the sewage treatment fee mechanism, this is a sample worth studying.

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