"Carbon trading is very important, but it is still in the trial stage in China as a whole," said Dr. Liu Qiang, deputy director of the CDM (Clean Development Mechanism) Management Center of the Energy Research Institute of the National Development and Reform Commission of China, at a "Energy Conservation and Low Carbon" lecture held at the UK Pavilion of the World Expo on the 23rd.
Liu Qiang stated that currently, apart from the relatively well-developed CDM (Clean Development Mechanism) market, China is generally still in the experimental stage of carbon trading. The focus is more on finding carbon trading models beneficial to China's development and emission reduction through pilot demonstrations. A positive yet cautious approach should be taken towards carbon trading.
In early August, China's National Development and Reform Commission announced five provinces and eight cities as pilot areas for low-carbon provinces and cities. Beijing, Tianjin, and Shanghai have also established exchanges to pilot trading activities related to energy conservation and emission reduction.
According to Liu Qiang, while the proposal of China's domestic carbon intensity target provides a good policy signal and platform for carbon trading, there are still many issues to be explored before carbon trading can be truly realized. These issues involve various aspects such as mechanisms, institutions, participation models, allocation, and benchmarks, and need to be addressed through pilot programs.
Furthermore, Liu Qiang pointed out that China's carbon intensity target is a voluntary target and is not related to international commitments, nor does it require international MRV (Measurable, Reportable, and Verifiable). In this context, it is even more necessary to consider the future relationship between the domestic and international carbon markets, as well as the roles played by different institutions within them, and to address these issues through pilot programs.
In Europe, carbon trading has already developed to a certain extent, and its experience can serve as a reference for China's energy conservation and emission reduction efforts.
At the lecture that day, Blue Sky, the China Director of the UK Carbon Trust, introduced some specific practices of the current EU carbon trading system: large energy users (accounting for 40% of greenhouse gas emissions) must measure and report their carbon emissions; if a company generates too much carbon emissions, it must purchase emission permits from low-emission companies; in addition, emission caps are periodically reduced.
By comparing carbon taxes and carbon trading, Lantian Mu argues that carbon trading, through price fluctuations, can achieve the goal of carbon savings and is easier to reach a consensus on. However, there are still debates regarding whether emission permits are allocable and whether their floor price is fair.
— Source: Hong Kong Trade Development Council
