China’s Carbon Market is Booming

The Ministry of Ecology and Environment stated Monday that China’s national carbon market has shown increasing vitality over the past three years.

Said Pei Xiaofei, a ministry spokesman, the market reported a trading volume of 465 million tons of carbon emissions and a total turnover of 27 billion yuan (approximately 3.79 billion U.S. dollars) as of the end of June.

According to the spokesman, the carbon price has been steadily rising; the closing price on launch day was 48 yuan per tonne, then rose to 91.6 yuan on July 26 this year, showing a growth of 90.8 percent.

One of the key instruments to assist lower carbon footprints and fulfill emissions objectives is thought to be carbon trading, which lets the buying and selling of licenses to emit carbon dioxide or other greenhouse gases.

Measuring 5.1 billion tonnes of carbon emissions annually, China’s national carbon trading market is the biggest in the world based on the volume of greenhouse gas exchanged. Official statistics reveal that the market now consists of 2,257 power generating emitters.

Over the past three years, China’s trading market has shown development in several spheres, according to Pei; a quite complete institutional framework has been developed and its carbon emissions accounting and management capacity has increased.

The ministry will keep positioning the market as a tool to reduce emissions, include emitters from other sectors, deepen international exchanges and cooperation, and aim to create a carbon market that is more effective, dynamic and internationally influential, the spokesman said, for the next phase.

Declaring that it will strengthen the cap-and-trade system for carbon emissions, China has promised in a significant paper recently to improve the mechanisms for green and low-carbon growth, so guiding towards reaching peak carbon emissions and carbon neutrality.

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Shayne Heffernan