From Pilot to the National Emissions Trading Scheme in China: International Practice and Domestic Experiences

Jun Dong, Yu Ma and Hongxing Sun
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Jun Dong: School of Economics and Management, North China Electric Power University, Changping District, Huilongguan, Beinong Road, No. 2, Beijing 102206, China
Yu Ma: School of Economics and Management, North China Electric Power University, Changping District, Huilongguan, Beinong Road, No. 2, Beijing 102206, China
Hongxing Sun: School of Economics and Management, North China Electric Power University, Changping District, Huilongguan, Beinong Road, No. 2, Beijing 102206, China

Sustainability, 2016, vol. 8, issue 6, 1-17

Abstract: In order to tackle climate change and build a low-carbon economy, China has selected seven provinces and cities as carbon trading pilots and plans to establish the national emissions trading scheme (ETS) in 2017. However, since China has not yet reached peak carbon emissions, and as a major developing country, the conflict between increasing energy demand and the requirement to reduce emissions brings challenges to the design of a national ETS suitable for China’s development. In this paper, we summarize the current situation of China’s seven ETS pilots with respect to coverage, allowance allocation, transactions, punishment mechanisms and especially the market performance. By analyzing the common practice of three international mandatory schemes, combined with China’s current circumstances and characteristics of market construction and regulation, we emphasize China’s own economic reality, and propose several recommendations for building a suitable and effective national ETS. This paper could provide new perspectives towards scheme design for China and other similar countries.

Keywords: emissions trading scheme; carbon trading; China ETS pilots; international mandatory ETS (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2016
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (11)

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