200 local firms to take part in test of carbon trades
By Richard Fu |
August 17, 2012, Friday
|
Print Edition
Print Edition
ABOUT 200 local companies will participate in a pilot carbon-trading program in Shanghai when it starts next year, as part of China's efforts to clean up the environment with a market-based approach rather than prescriptive command and control regulation.
The city was one of the seven provinces and municipalities chosen by the National Development and Reform Commission in November to set up carbon trade markets in a trial program from 2013 to 2015.
In carbon trading, a cap is set on the amount of carbon dioxide that may be emitted and then the limit is allocated to participating firms in the form of carbon credit, or the right to discharge a specific volume. Fimrs with excessive emissions have to buy credits from others.
China is planning trials on the provincial level in preparation for creating a national market, said Xie Zhenhua, vice chairman of the NDRC, China's top planning agency.
When China has more experience, it's possible to create a regional Asia Pacific market with countries like Japan and Australia, which had proposed such a system to China, he said.
"We have to do more basic studies," he said. "We should avoid (carbon trade) adding cost burdens to companies, but we also have to ensure market demand (for such carbon credit)."
Xie was speaking at a work conference in Shanghai yesterday that marked the start of the city's effort to develop its own carbon market. He called the event a "landmark step" for China's carbon market.
Local participants will include industrial companies with annual carbon dioxide emission of over 20,000 tons such as Baosteel and non-industrial firms with emission of over 10,000 tons like Jin Jiang Hotel. They would receive their respective initial credits, based on historical data, for free.
Vice Mayor Yang Xiong said Shanghai will accelerate drafting rules on carbon trade and create a credit allocation system. Trading is to start in the second half of next year.
Xie said companies involved have the chance to adapt to the carbon trading market earlier and could be more competitive than peers in the long run by adjusting planning and upgrading technology in advance.
The city was one of the seven provinces and municipalities chosen by the National Development and Reform Commission in November to set up carbon trade markets in a trial program from 2013 to 2015.
In carbon trading, a cap is set on the amount of carbon dioxide that may be emitted and then the limit is allocated to participating firms in the form of carbon credit, or the right to discharge a specific volume. Fimrs with excessive emissions have to buy credits from others.
China is planning trials on the provincial level in preparation for creating a national market, said Xie Zhenhua, vice chairman of the NDRC, China's top planning agency.
When China has more experience, it's possible to create a regional Asia Pacific market with countries like Japan and Australia, which had proposed such a system to China, he said.
"We have to do more basic studies," he said. "We should avoid (carbon trade) adding cost burdens to companies, but we also have to ensure market demand (for such carbon credit)."
Xie was speaking at a work conference in Shanghai yesterday that marked the start of the city's effort to develop its own carbon market. He called the event a "landmark step" for China's carbon market.
Local participants will include industrial companies with annual carbon dioxide emission of over 20,000 tons such as Baosteel and non-industrial firms with emission of over 10,000 tons like Jin Jiang Hotel. They would receive their respective initial credits, based on historical data, for free.
Vice Mayor Yang Xiong said Shanghai will accelerate drafting rules on carbon trade and create a credit allocation system. Trading is to start in the second half of next year.
Xie said companies involved have the chance to adapt to the carbon trading market earlier and could be more competitive than peers in the long run by adjusting planning and upgrading technology in advance.
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