BEIJING (BLOOMBERG, REUTERS) - China on Tuesday (Dec 19) unveiled its plan for a national carbon market, creating the world's biggest trading system for the climate-warming emissions.
The market will initially involve only the power sector, National Development and Reform Commission vice-chairman Zhang Yong said Tuesday (Dec 19) at a briefing in Beijing. While that's a pullback from the nation's previous plan to include eight industries, China's market will still be bigger than the European Union's system.
Zhang did not give details on when trading will start. Nine regions and cities, including Jiangsu, Fujian and seven regions where pilot schemes have taken place, will coordinate to establish the system, according to a statement released ahead of the briefing.
The world's biggest carbon emitter wants to use a market-based system to help it cap emissions by about 2030. The nation is also making big bets on clean-energy projects to help reach its goal of deriving 20 per cent of its energy from sources other than fossil fuels by that year.
The introduction of carbon trading will "send a strong political signal to the international community that China will meet its international commitment and lay a foundation to take actions to support the Paris climate agreement", Zou Ji, San Francisco-based Energy Foundation's China president, said before the announcement.
Within China, the market will force financial institutions and businesses to consider the carbon impact when they make medium- or long-term plans, he said.
China has been running pilot programmes since 2013 in some regions, where transaction values totalled 4.5 billion yuan (US$680 million) as of September, Li Gao, an official of the climate-change department at the NDRC, said at a briefing in October.