Greenhouse Emissions Trading becomes mandatory in China

As of 10 January 2015, greenhouse gas emissions trading becomes mandatory in China. The National Development and Reform Commission (NDRC) adopted the Provisional Measures on the Management of Carbon Emission Trading (碳排放权交易管理暂行办法) on 10 December 2014, which would be further implemented by a State Council implementing regulation and technical standards over 2015. The whole China-wide greenhouse gas emissions trading market would be fully implemented from 2016 to 2020.  An emission quota will be allocated by NDRC to each province through determined quota allocation criteria.

A list of companies exceeding emission threshold and subject to mandatory emissions trading will be released by NDRC shortly. Those companies shall obtain (grandfathering) emission quota. A first batch of industries would mainly consists of heavy energy consumption and high emission industries such as iron and steel, petroleum and non-ferrous metal. Some pilot service industries such as airports, hotels would not be included in the near future.

The world’s biggest-emitting nation, accounting for nearly 30 percent of global greenhouse gas emissions, plans to use the market to slow its rapid growth in climate-changing emissions. China has pledged to reduce the amount of carbon it emits per unit of GDP to 40-45 percent below 2005 levels by 2020.