CHINA National carbon trading boon for neutrality goal

CHINA

National carbon trading boon for neutrality goal

China Daily

08:19, July 19, 2021

Aerial photo taken on Aug 19, 2020 shows wind turbines in Jiucaiping scenic spot in Southwest China's Guizhou province. (Photo: Xinhua)

The national carbon emissions trading market launched online trading on Friday. The power generation industry was the first industry to be included, with 2,225 power companies taking the lead.

According to estimates by the Ministry of Ecology and Environment, these companies have carbon emissions of more than 4 billion tons.

The trading of carbon emissions rights means using carbon emissions quota as a commodity that can be bought and sold. The launch of the national carbon emissions rights trading market is an important step toward controlling and reducing carbon emissions.

It has commenced with the power generation industry, not only because power generation has higher carbon emissions than other industries, but also because the industry has more adequate supporting conditions for carbon trading. Electric power companies have relatively unified cost accounting methods for carbon emissions verification, carbon asset development, carbon market transactions and supporting services, which are helpful to the implementation of carbon trading in the industry.

At present, coal power still accounts for more than 60 percent of the country's power generation. With the establishment of the national carbon trading rights market, carbon prices will rise, gas power will become more competitive, and more enterprises will choose to use gas power rather than coal power.

At the same time, the power industry still has huge room for development. With the adoption of new energy vehicles, electricity consumption will increase simultaneously. Through the national carbon emissions trading market, the supply side reform of electricity can be accelerated. Reforms will allow more clean electricity to be used in various fields in the future.

The power industry will become more environmentally friendly and finally achieve the development goal of building a new power system with new energy as the main body.

After the power industry, more industries will inevitably be gradually included in the national carbon emissions trading market. Research institutions predict that in the next few years, eight major energy-intensive industries, including steel, nonferrous metals, petrochemicals, chemicals, building materials, papermaking, electric power and aviation, will be included. This also means that the use of carbon trading rights to promote green upgrades in various industries will become the general trend.

Therefore, the launch of the national carbon emissions trading market will balance various goals such as energy transformation, industrial upgrading, environmental governance and high-quality economic development, which will have a profound, extensive and long-term impact on the economy and society.

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