What is Carbon Emissions Trading?

Carbon emissions trading refers to the important mechanism of using the market economy to promote environmental protection. It allows companies to use these reduced carbon emissions to use or trade internal and domestic enterprises under the premise that the total emissions stipulated in carbon emissions trading do not exceed. External energy. The 17th theme of the "Kyoto Protocol" stipulates that carbon trading is a tradable quota system based on the quotas calculated from the commitments of emission reduction and emission reduction commitments listed in Annex B of the Protocol. For example, the global carbon emission limit is 100 units, country A gets 15 units of indicators, country B gets 10 units of indicators, and other countries get the remaining 75 units of indicators. If country A emits only 10 units and country B emits 12 units, then country B can purchase 2 units of carbon emissions from country A. At present, in promoting carbon emissions trading, the European Union is at the forefront of the world and has developed a gas emissions trading scheme applicable in the European Union. By identifying the greenhouse gas emissions of 10,000 units in specific fields, emission reduction subsidies are allowed to enter the market To achieve the goal of reducing greenhouse gas emissions.

Carbon trading

Carbon emissions trading (referred to as carbon trading) is to promote global greenhouse gas reductions, ^[1]

This is like the principle of conservation of mass in physics. If the total amount of carbon emissions is limited. Then within this framework, we can reduce carbon emissions through technological upgrades. Each country has a corresponding "indicator". For example, this year, the global limit is to emit 100 units of carbon emissions. Country A gets 15 indicators. Country B gets 10 indicators. Other countries get the remaining 75 indicators. If Country A emits only 10 units of carbon emissions, and Country B just emits 12 units, then Country B can purchase 2 units of carbon emissions from Country A.

Petrochemical enterprises are enterprises with high energy consumption, high pollution and high emissions. Obviously, it will be difficult to meet future environmental protection requirements without adopting technological transformation measures for energy conservation and emission reduction. Enterprises will improve production processes, equipment and technology. But the key is the development of new energy sources that replace existing fossil energy sources. such as wind, nuclear, photovoltaic, etc.

In the long run, petrochemical companies will gradually reduce the proportion of new energy development and application. But this still requires a very long process.

Enterprises and residents should choose energy-saving and environmentally-friendly products.

At present, China has seven major carbon emission exchanges: Guangzhou Carbon Emissions Exchange, Shenzhen Emissions Exchange,

Currently pushing

Beginning in 2004, transactions focusing on various emission (emission reduction) quotas and emissions reduction projects have become larger and larger at the same time, giving birth to a global carbon emissions trading market with a transaction size of US $ 118 billion, which has grown in five years. More than a hundred times. However, when "

The BBC released on the 19th entitled "Analysis: How Successful Can China's Carbon Emissions Trading Be? "The article said that although the carbon emission reduction market outlook is full of many unknowns, it is certain that China's overall pattern of emission reduction and pollution resistance will change as a result. The article mentioned that after the carbon emission reduction trading plan was promoted throughout China from 2015 to 2016, China will become the world's largest carbon emission reduction trading market, but there are also many doubts about the operation prospects of this market. Some people expect that as the Chinese government's efforts to reduce pollution and emissions increase, the price of carbon emission reduction rights will rise, which may trigger speculative operations. The excessive increase in the price of emission reduction rights may bring results that are contrary to the original intention, or damage the realization of market-driven emission reduction plan goals.

The Information Office of the State Council held a press conference at the Press Office of the Information Office of the State Council on Wednesday, November 21, 2012 at 15:00, and invited Xie Zhenhua, deputy director of the National Development and Reform Commission, to introduce China's 2012 report on climate change policies and actions. China's carbon emissions trading pilot was started in November 2011. Seven provinces and cities have been identified as pilot areas. Now each pilot unit is starting this work, establishing a special team, preparing implementation plans, and some have already Began to establish some systems for carbon trading, and also established transaction verification and certification agencies. Now some regions and cities such as Beijing, Shanghai, Guangdong, etc. are basically ready.

In fact, the most basic thing for carbon trading is to determine the total amount of carbon emissions in this region, and then determine some quotas, and allocate these quotas to various key emission companies or units. With these most basic things, you can calculate the cost of reducing emissions. The greater the gap in emission reduction costs between units and industries, the greater the enthusiasm for transactions. So now it should be said that preparations are generally in place. In order to regulate the behavior of transactions in various places, the National Development and Reform Commission promulgated and implemented the "Interim Measures for the Management of Voluntary Greenhouse Gas Emission Reduction Transactions", and launched the state-approved voluntary emission reduction projects, trading products, trading platforms, and third-party audits through record management Accreditation institutions to promote open, fair and fair markets. In addition, the Guidelines for the Validation and Certification of Voluntary Greenhouse Gas Emission Reduction Transactions has also been issued, mainly to standardize the validation and certification work and ensure the smooth implementation of management measures. Now that exchanges in various places have been established, our pilot progress has been relatively smooth. We hope to summarize the carbon trading system suitable for China's national conditions on the basis of these pilots. On this basis, we will also carry out exchanges and cooperation with other countries in this regard. Now, Australia, the European Union and neighboring countries, as well as the United States, want to cooperate with us, and also hope to establish a global carbon market.

In early 2013, Beijing and Shanghai, which were included in the nation s first batch of pilot cities for carbon emissions trading, are expected to take the lead in piloting domestic regional voluntary emissions reduction transactions. Among the preliminary carbon emissions trading pilot schemes in Shanghai, about 200 were the first batch of companies to participate in the pilot trading, involving 16 industries, including 10 industrial industries such as steel, petrochemicals, nonferrous metals, and power, as well as aviation, ports, airports, and hotels. 6 Each of the non-industrial industries is a "big player" in greenhouse gas emissions. It is estimated that the total annual carbon dioxide emissions of these 200 companies will be about 110 million tons. During the trading pilot period, initial carbon emission allowances will be issued free of charge, and then a paid auction system will be implemented in due course. During the pilot period, the carbon emissions allowances of pilot enterprises cannot be borrowed in advance, but they can be stored and used across years. ^[4]

On June 18, 2013, the first domestic carbon emission trading platform was launched in Shenzhen, marking a crucial step in the construction of China's carbon trading market. Since then, Beijing, Tianjin, Shanghai, Guangdong, Hubei, Chongqing and other provinces and cities have successively launched carbon emissions trading pilots. After more than a year of development, the rules of the carbon trading market in each of the pilot provinces and cities have gradually improved.

Similar to foreign carbon trading markets, China's current carbon trading market is also divided into two parts, namely, compulsory quota trading and voluntary Chinese Certified Voluntary Emission Reduction (CCER) trading. The pilot projects in the seven provinces and cities all allowed enterprises to use a certain percentage of CCERs during implementation.

In the seven pilot regions, most provinces and cities have issued quotas to emission-controlling enterprises for free. Therefore, in the primary market for quota trading, carbon quotas are mainly granted by administrative allocation. Among them, Guangdong, Shenzhen and Hubei also use auctions to award Part of the quota is paid to the regulated enterprises for a fee. On March 31, 2014, Hubei Province completed its first bidding transfer, with a total of 2 million tons of 2013 quota transferred, and all quotas sold out. The auction reserve price is 20 yuan / ton, the transaction price is the same as the reserve price, and the total transaction price is 40 million yuan. In 2014, Guangdong completed six auctions on a trial basis, with a total turnover of 559 million yuan in 2014 and a cumulative auction turnover of 739 million yuan. ^[5]

On December 19, 2017, the highly-regarded national carbon emissions trading system was officially launched. On the same day, the National Development and Reform Commission held a teleconference to deploy the National Carbon Emissions Trading Market Construction Plan (Power Generation Industry), which kicked off the construction of a unified national carbon market. ^[6]