China’s carbon emission trading system (ETS) was launched on Jul 16 and traded 4.1mn mt of carbon dioxide quotas with an estimated value of CNY210 ($32mn).
The Asian nation’s government is collecting data on steel, non-ferrous processors, chemicals, cement, and other sectors to expand carbon trading. Emissions equaling 4.5bn of carbon dioxide will be covered in 2021, but 14.09bn was emitted by Chinese firms in 2019.
China has about 2,200 power plants that produce about 4bn mt of carbon emissions and this first trading cycle focused on the industry.
The scheme was established in late 2015, with a soft launch in 2017. The ETS implementation was delayed following apprehensions over the transparency of emission data.
The Tianjin government, with a variety of industries, but heavily vested in petrochemicals, announced the desire to integrate logistics using blockchain in 2019. In keeping with this announcement, the province launched China’s first blockchain-based carbon offset certificate alongside the carbon market using AntChain recently.
China seeks to reach carbon neutrality by 2060 with strong strides by 2030. The size of China and its reliance on fossil fuels make the present carbon trading system small in the resolution but prepares industries for eventual tightening in the future. Carbon allowances were about $7.5/mt in China in comparison to about $60/mt in the EU that covers 1.4bn mt. The higher cost makes fossil fuels like coal and natural gas less attractive.