Industry News
2026-10-19Introduction: The General Office of the Ministry of Water Resources and the Office of Agricultural Bank of China have jointly issued the "Notice on Doing a Good Job in Financial Services for the High-Quality Development of the Water-Saving Industry" (Ban Jieyue [2026] No. 148), specifying seven key support areas, with wastewater reclamation and reuse ranked first among "unconventional water development and utilization." Agricultural Bank of China aims to provide an intentional credit line of RMB 3000亿 to water-saving and water-supply related fields during the "15th Five-Year Plan" period. Loans for key projects under national-level plans may have a maximum term of up to 45年, and the capital ratio may be reduced to as low as 15%.
Policy Highlights: RMB 3000亿 Credit Line and Seven Key Areas
The Notice is grounded in the water governance approach of "water conservation priority, spatial balance, systematic governance, and leveraging both government and market forces," implements the "Water Conservation Regulations" and the deployment of the "15th Five-Year Plan" outline, and provides green financial support in seven aspects: credit line, loan term, loan interest rate, capital ratio, comprehensive financial services, service model innovation, and customer service. The seven key support areas cover agricultural water conservation and efficiency enhancement, industrial water conservation and emission reduction, urban water conservation and loss reduction, unconventional water development and utilization, water-saving equipment manufacturing enterprises, water-saving service enterprises, and water conservation in major strategic regions, achieving full-chain coverage of the water-saving industry.
Among them, the fourth item—unconventional water development and utilization projects—is most directly related to the wastewater treatment and reclaimed water reuse industry, explicitly including wastewater reclamation and reuse, rainwater harvesting and utilization, direct seawater utilization, seawater desalination utilization, mine pit (well) water treatment and utilization, brackish water treatment and utilization, and unconventional water metering and monitoring. Meanwhile, the industrial water conservation and emission reduction area explicitly supports centralized wastewater treatment and utilization in industrial parks, wastewater recycling in industrial enterprises, unconventional water substitution and equipment upgrading in high water-consumption industries; the urban water conservation and loss reduction area supports leakage monitoring and control of public water supply networks and the construction of digital and intelligent water affairs platforms.
Breaking Down Financial Conditions: What the 45年 Term and 15% Capital Ratio Mean
For asset-heavy, long-cycle water projects, financing conditions often determine whether a project can be implemented more than subsidies do. The conditions given in the Notice are quite specific:
- Credit line—Agricultural Bank of China aims to provide an intentional credit line of RMB 3000亿 to water-saving and water-supply related fields during the "15th Five-Year Plan" period;
- Loan term—key water-saving projects included in relevant national plans shall not exceed 45年, and key projects included in provincial-level plans shall not exceed 35年;
- Capital ratio—the key support areas of the water-saving industry generally apply 20%; for social livelihood projects that address weak links in accordance with national regulations, under the premise of a clear investment return mechanism, reliable returns, and controllable risks, it may be further reduced by no more than 5 percentage points, i.e., as low as 15%;
- Interest rate and guarantee—differentiated pricing shall be given to eligible projects, and exploration shall be made of pledge guarantees for rights and interests such as water use rights and water efficiency-linked incentive loans for water-saving carriers at or above the provincial level and units certified under water-saving management systems;
- Comprehensive financial services—provide bond and securitization issuance and underwriting, equity investment, financial leasing, and financial advisory services, and actively participate in the declaration and issuance of water conservancy infrastructure REITs to revitalize existing assets.
Extending the loan term to 45年 essentially doubles the cost amortization window for long-cycle assets such as reclaimed water plants and pipe networks, significantly improving the early-stage cash flow pressure of projects; the reduction of the capital ratio directly lowers the contribution threshold for social capital parties, which is particularly critical for enterprises participating in the upgrading and renovation of existing wastewater treatment plants through BOT and ROT models.
Customer Tiering: Leading Enterprises and "Little Giants" Enjoy Fast-Track Approval
The Notice provides a clear incentive gradient on the customer service side. For eligible leading enterprises in the water-saving industry, Agricultural Bank of China shall prioritize them as head-office-level core customers; for specialized, refined, distinctive and innovative "Little Giant" enterprises, single-champion enterprises, and unicorn enterprises in the water-saving industry, as well as enterprises participating in the construction of ministerial- or provincial-level or above water-saving technology innovation centers, proof-of-concept platforms, and pilot validation platforms, they shall be prioritized as tier-1 branch-level or above core customers; for eligible major projects, they shall be prioritized for inclusion in the management of the head office major project list, enjoying differentiated policies in customer access, customer rating, credit line, loan term, capital ratio, repayment plan, and other aspects, and implementing a priority completion or fast-track loan approval mechanism.
Notably, the Notice also proposes to actively support leading enterprises in the water conservation industry to "go global" and to provide comprehensive cross-border financial services. This provides supporting financial instruments for domestic water treatment equipment and engineering enterprises to participate in overseas reclaimed water projects in Southeast Asia, the Middle East and other regions.
Implementation Mechanisms and Risk Bottom Lines
To ensure policy implementation, the Ministry of Water Resources and the Agricultural Bank of China have established a government-bank business cooperation mechanism and a regular liaison and consultation mechanism. All river basin management agencies and provincial-level water administrative departments have established regular cooperation mechanisms with the first-level branches of the Agricultural Bank of China, strengthening policy and information sharing and providing financial support for the water conservation industry and technological innovation. On the risk side, the Notice explicitly prohibits the creation of new hidden government debt, strictly controls credit allocation, does not support obsolete water-related projects, and requires strengthened sharing of risk warning information.
Industry analysis suggests that as green financial instruments and the rigid water resource constraint system form a synergy, three tracks will benefit first: wastewater reclamation and reuse, classified and cascade utilization of wastewater in industrial parks, and pipeline network leakage control. For water treatment enterprises, the key lies in aligning technical solutions with the financing language of quantifiable water efficiency, pledgeable water rights, and calculable returns, so as to truly convert policy dividends into project implementation rates.
Conclusion
From "wanting to conserve water" to "having the money to conserve water," Ban Jieyue [2026] No. 148 has filled in the most critical link in the water conservation industry. The RMB 3000亿 billion in intended credit, the 45年 term, and the 15% minimum capital ratio together constitute a financing framework suited to long-cycle water utility assets. For industry enterprises in the window period of upgrading and transformation and large-scale reclaimed water reuse, this is both a positive on the funding side and a hard constraint on the water efficiency and cash flow quality of the projects themselves.
About TIANYI TECH: TIANYI TECH (TIANYI LIMITED) focuses on the fields of wastewater treatment, reclaimed water reuse and water environment governance, providing municipal and industrial clients with full-chain services including process design, equipment integration, engineering general contracting and smart operations. The company continuously tracks global water treatment policies, technologies and market dynamics, and is committed to helping customers achieve efficient utilization and sustainable management of water resources with reliable solutions. For more information, please visit the company website www.tianyitech.hk.
Source: Public information from the Ministry of Water Resources of the People's Republic of China, the National Water Conservation Office, and the Notice on Doing a Good Job in Financial Services for the High-Quality Development of the Water Conservation Industry (Ban Jieyue [2026] No. 148) (2026年9–10月)
