1101. Increasing the Emissions-Reduction Efficiency of Carbon Trading Schemes in China Under the “30.60” Target: Reflection on the Carbon Markets of Guangdong Province, China
- Author:
- Chen Shaoqing
- Publication Date:
- 03-2022
- Content Type:
- Policy Brief
- Institution:
- Belfer Center for Science and International Affairs, Harvard University
- Abstract:
- Key Points: • Guangdong currently has two pilot carbon-emissions-trading markets (in Shenzhen — and in Guangzhou, for the remainder of Guangdong Province). The Guangdong—Hong Kong—Macao Greater Bay Area (GBA) carbon market will be established in the near future. Therefore, Guangdong Province has regional advantages in innovation in the low-carbon field. • In September 2020, China announced its intention to peak carbon emissions by 2030 and achieve carbon neutrality by 2060. To meet its responsibilities under the “30.60” target, GBA needs to choose a less costly and more efficient way to reduce emissions, build resilience to climate impacts, and promote green economic recovery from the COVID-19 pandemic. • In terms of accounting methods, life-cycle accounting from production and consumption perspectives should be the methodological basis for cities, parks, and enterprises to participate in carbon trading. • Trading activity in China’s carbon markets needs to be increased. In the future, carbon markets can gradually be opened to small and medium-sized enterprises and individuals, and cross-border trade can also be included in carbon trading mechanisms, with proper risk management. • At present, carbon quotas in local pilots and the national market are allocated freely. In the future, a reasonable mix of auctioned allocation and free allocation can be considered to establish a transparent, fair, and dynamic carbon-quota-allocation mechanism. • After starting with the electricity industry, the national carbon market will continue to include other key high-carbon industries; China should seek balanced development between local pilots and the national carbon market to improve the efficiency of emission reduction.
- Topic:
- Climate Change, Environment, Carbon Emissions, and Air Pollution
- Political Geography:
- Asia-Pacific