In China, the term “carbon neutral” is everywhere. Companies across the board are slapping the label on their products, claiming everything from beverages to batteries is carbon-neutral. While it sounds promising, there’s a catch: China’s carbon-neutral claims are mostly backed by carbon offsets, which involve “neutralizing” emissions by investing in projects that absorb or reduce CO2 elsewhere. The idea is that the company’s emissions are “balanced out” by these offsets, which can include planting trees or funding renewable energy projects.

But this offset-driven approach has sparked global debate. Critics argue that carbon neutrality achieved solely through offsets is more marketing than meaningful change. The EU and Canada have both recently cracked down on greenwashing: in Canada, companies can no longer make unsupported environmental claims, while the EU has banned all green claims based solely on offsets.

So, where does that leave China’s green tech revolution?

This year, China took its first big step toward tightening carbon neutrality standards. As of October 1, the country has implemented national standards for product carbon footprint accounting. This means products claiming to be low-carbon or carbon-neutral will need more standardized and transparent accounting to prove it. China’s new framework is set to gradually phase in product-specific carbon accounting standards, adding layers of verification and accountability.

The government also banned certain terms like “verified” in carbon certifications to prevent misleading claims. The move signals that the era of loosely regulated, self-proclaimed carbon-neutral products may be coming to an end.

Why Accurate Carbon Labeling Matters

If China is serious about reaching its ambitious goal of carbon neutrality by 2060, it has to make sure consumers trust the green labels they see on store shelves. Reliable carbon footprint data could help China’s consumers make more informed, eco-conscious choices. This shift is also essential for the credibility of China’s booming green-tech sector. As consumers grow savvier about sustainability, they want transparency on the products they buy.

What’s Next? The Road to Carbon Transparency

China’s new carbon footprint standards are a strong start, but real change will require consistent follow-through. Standards alone won’t turn a carbon-neutral claim into reality; companies will need to prove that their emissions are genuinely reduced, not just offset. As the government rolls out these standards, companies will be under pressure to update their production processes, invest in renewable energy, and make real strides in reducing their overall carbon footprint.

For consumers in China, these developments mean that the next time they pick up a product claiming to be carbon-neutral, they’ll have reason to believe it’s the real deal. And for green tech enthusiasts? The shift toward verifiable, trustworthy carbon labeling in China is a huge step forward in the global push for a truly sustainable future.

China’s New Approach to Green Standards

Imagine strolling through a mall in China, looking at products labeled as “carbon-neutral.” Maybe it’s pet food, shampoo, or a “green” electronic gadget. Until now, many products have relied on carbon offsets to make such claims, but the standards behind these labels are shifting. China’s government is cracking down on vague, potentially misleading labels, and a new era of carbon labeling standards is beginning to take shape.

What’s Changing for Carbon Labels?

In China, the buzzwords “verified,” “approved,” or “examined” are now off-limits for carbon neutrality labels. As of April, companies cannot use these terms to back up claims of carbon neutrality or low emissions unless they’ve met strict standards registered with authorities. This change aims to remove greenwashing from the equation, providing more reliable, actionable information for consumers. The hope? To allow consumers to confidently choose products that contribute to lowering emissions rather than just paying lip service to the environment.

Yet, this doesn’t mean China has it all figured out. While 1,400 certification bodies are registered across sectors, from consumer goods to energy, there are still no uniform national standards. With companies like Carbonstop already listing over 300 low-carbon products on its e-commerce site, it’s clear there’s a hunger for green-labelled goods. But the quality of these certifications is inconsistent, creating confusion over what truly qualifies as “low carbon” or “carbon-neutral.”

The EU Says “No More Offsets”—Could China Be Next?

China is not alone in rethinking carbon-neutral labels. The European Union recently took a hard stance against greenwashing with the Empowering Consumers for the Green Transition directive. Under this policy, the EU banned carbon-neutral labels that rely solely on offsets, and it will soon prohibit terms like “environmentally friendly” or “climate-positive” if they lack direct evidence. Essentially, companies must prove that their emissions have been reduced through the entire lifecycle of a product, not just offset.

China’s approach differs—for now. Although offsets remain part of the picture, the government is pushing for better oversight and quality control. For instance, the China Certified Emission Reductions (CCER) program, which produces government-certified carbon credits, was temporarily halted due to issues like fraud and data transparency but is now back under tighter regulation. These reforms signal that carbon offsetting could soon face tougher scrutiny in China, too.

Carbon Offsetting and Greenwashing

One reason for global skepticism toward offsetting is its potential for abuse. In early 2023, revelations surfaced that the world’s biggest certifier of carbon offsets, Verra, had overseen rainforest projects with inflated claims—up to 90% of their offsets were deemed ineffective. South Pole, the largest carbon trader, also faced criticism for overstating its projects’ impacts. These controversies, involving some of the largest emitters, have damaged the credibility of offsetting as a reliable path to carbon neutrality.

China’s carbon market, though more regulated than before, remains entangled in these global challenges. A key problem is transparency: once a carbon credit is bought, it’s often “retired” or canceled, but cases of double-counting and “recycled” offsets continue to arise. China’s voluntary carbon market, now overseen by the Ministry of Ecology and Environment, has implemented stricter controls to reduce these issues, but critics argue that more transparency and clear standards are needed.

Labels That Matter

While the new regulations on labeling in China are a strong first step, more must be done to truly change how carbon impact is conveyed to consumers. The Ministry of Ecology and Environment has advised companies to consider various carbon standards, including international benchmarks like the UN’s Clean Development Mechanism (CDM) and Verified Carbon Standard. But there’s a catch: offsets alone won’t suffice. Companies can’t just purchase credits and claim “carbon-neutral” status—they must demonstrate genuine emissions reductions.

For a sustainable, green-tech future in China, the quality and transparency of carbon labels will be essential. Consumers want more than just promises; they need clear and consistent information to make eco-friendly choices. With these new moves, China is on a path to delivering that transparency, making carbon-neutral claims more than a marketing ploy and transforming them into a genuine commitment to reducing emissions.

As we bid farewell to loosely applied carbon-neutral labels, China’s journey toward meaningful carbon standards may just be beginning. And for green-tech enthusiasts, this shift marks a significant step forward in creating a world where “carbon-neutral” can truly mean what it says.

Can Labels Drive Real Change?

As carbon-neutral products and services pop up across global markets, China faces a pivotal question: will its carbon neutrality certification system continue as it is? While Europe has cracked down on vague, unverified “carbon-neutral” claims, China’s stance remains more flexible—for now.

Although the EU recently tightened the rules on carbon-neutral claims, it’s not against carbon neutrality as a goal. Instead, the EU’s focus is on ensuring transparency and accountability, preventing companies from slapping on labels without genuine emissions data to back them up. In China, however, terms like “certificate” and “statement” for carbon-neutral products are still allowed, and certification remains an option. This approach gives companies leeway to advertise their carbon-neutral goals, although expectations around data transparency are beginning to rise.

According to Ouyang Cheng, consulting director at Carbonstop, carbon-neutral labels do more than just inform—they motivate. Cheng points out that a detailed carbon footprint might seem abstract to most consumers (“10g of CO2” on a label doesn’t carry much weight), but if a product is labeled “carbon-neutral” or “low-carbon,” people are willing to pay more for it. This consumer interest could fuel a cycle of positive feedback, where companies invest more in carbon reduction, ultimately attracting talent, technology, and financial support for low-carbon innovations.

Both the EU and China are re-evaluating their approach to offset-backed claims, leaving voluntary carbon markets uncertain about their future. Many of the carbon credits that companies purchase for offsetting come from these voluntary markets, which allow businesses to meet carbon-neutral goals through emission-reduction credits.

One Chinese expert notes that EU restrictions on offset-backed claims could significantly impact voluntary emission-reduction markets worldwide, potentially even affecting China’s offset programs like the China Certified Emission Reductions (CCER). For now, the CCER scheme has reopened after a suspension due to data quality issues, but questions remain about whether consumer trust in offsets will be enough to support carbon-neutral claims in the long term.

China’s 2025 Plan

While carbon-neutral labels can help guide consumers, they rely heavily on accurate carbon footprint accounting. This is where China faces a unique challenge: unlike some developed nations, which have had carbon-accounting standards and emissions databases in place for years, China is still developing its system.

To catch up with global standards, China aims to establish a robust carbon footprint database by 2025. This database will provide a foundation for calculating product footprints across industries, allowing China to roll out a unified system for verification and labeling by 2027. This groundwork is crucial, as China increasingly trades with regions like the EU, where carbon footprint disclosures and product-level sustainability standards—such as those for electric vehicle batteries—are fast becoming a requirement. A unified system could streamline cross-border compliance, making it easier for Chinese companies to meet these global standards.

Standardization as a Building Block

The real challenge for China’s carbon neutrality ambitions lies in creating an interconnected, standardized system that can handle carbon accounting, certification, and labeling on a massive scale. As experts point out, standardization is a critical first step for any robust carbon-labelling system. Getting carbon labels right is essential, not just for guiding consumer choices but for building a foundation of trust and transparency that can support further advances in carbon accounting and certification.

With these foundations in place, China is setting itself up to integrate more seamlessly into the global green economy, ensuring that its products meet the high standards required by trading partners in the EU and beyond. For green-tech enthusiasts and sustainability-minded consumers in China, these moves signal a future where carbon labels aren’t just marketing, but part of a larger transformation toward a sustainable, accountable marketplace.