China’s carbon trading pilot schemes will cover 2000 businesses

The Parliamentary Secretary for Climate Change and Energy Efficiency, Mark Dreyfus, last week met China’s National Development and Reform Commission (NDRC) Vice Chairman, Xie Zhenhua, to discuss action on climate change.

Dreyfus and Vice Chairman Xie were in New York for the Major Economies Forum on Energy and Climate, a US-led coalition of 17 of the world’s top economies to drive international action on climate change.

“China has been making steady progress in developing its pilot emissions trading schemes,” said Dreyfus.

Last year, China announced it would establish pilot carbon trading schemes in seven key cities and provinces: Beijing, Chongqing, Shanghai, Shenzhen, Tianjin, Guangdong and Hubei.

“Taken together, China’s emissions trading pilots are establishing a price on carbon pollution covering around one-third of China’s GDP, and one-fifth of its population and energy use. China will draw on the experience of the pilots to build a nationwide carbon market between 2015 and 2020,” said Dreyfus.

“Beijing, Shanghai, Guangdong and Hubei have all released draft plans that outline the design and implementation pathway for their pilot schemes. Together these will cover carbon pollution from around 2000 businesses - six times as many businesses as covered by Australia’s carbon price.

“Guangdong province has a population of over 100 million people and an economy around the same size as Indonesia’s. Its draft plan, which was released two weeks ago, includes over 800 companies, covering 60% of Guangdong’s industrial power consumption.

“Introducing emissions trading is a complex task. China is keen to learn from the experience of others who have or are currently implementing emissions trading, such as Australia.

“We have been working closely with China over the last year on a range of policy and technical issues to support the development of credible, robust and effective carbon markets - including providing details of Australia’s approach in our emissions trading scheme.

“China is clearly taking steps to move to a clean-energy, low-carbon economy through the introduction of emissions trading, and through its huge investment in clean technology and policies to support innovation.

“Here at the Major Economies Forum, discussions are focused on a global solution to climate change. In this context, domestic action from countries like China sends a strong signal that the international community is acting to address this problem,” said Dreyfus.

For more on the forum, click here.