Emissions trading is not a new concept. The 1997 Kyoto Agreement and the 1990 US Clean Air Act both provided early introductions to emission markets, and the European Union Emissions Trading System (EU ETS) has been in action since 2005. In recent years, the role of emissions trading has been highlighted in the fight against climate change. The 2015 Paris Agreement impressed the need to advance emissions trading as a key policy tool to curb carbon emissions. At present, there are 24 active carbon trading systems in the world, including those of Canada, Switzerland, and South Korea. Singapore and Indonesia have expressed plans to introduce similar trading systems.
China has been developing a long-term emissions trading plan and ran pilot programs in seven cities in 2011. As the world’s largest emitter of carbon dioxide emissions, producing 27% of the globe’s emissions in 2019, China has set the ambitious goal of achieving carbon neutrality by 2060. In a crucial step toward achieving that objective, China launched its national carbon trading market in limited fashion on July 16, 2021, with hopes to encourage decarbonization in the country.
It has been smooth sailing for more than a month. The entities involved have traded credits equivalent to more than 8 million tons of carbon emissions for a turnover of over RMB 416 million (USD 64.4 million) as of September 2. What are some of the early takeaways from China’s carbon trading market? Why is the power generation sector the sole industry participating in carbon credit trading? What are some of the challenges that may arise due to the system’s current limitations? And, is China on a path to achieving carbon neutrality?
Join us on September 14 at 9:00 a.m. (GMT +8). We will cover:
- The mechanisms of China’s carbon trading market
- The power sector’s primary inclusion and other industries to be folded in
- Brief comparison with the EU ETS
- Challenges that may stem from the carbon trading market’s limitations
See you then!