Cap-and-Trade and New Market Mechanism Policy Design in China
Since 2005, CCAP has worked with top Chinese policymakers from the NDRC, Provincial and Local DRCs, the Ministry of Housing and Urban-Rural Development (MOHURD), Provincial climate exchanges, academics and in-country researchers to provide technical analysis on mitigation policies, helping China reach energy intensity and greenhouse gas reduction targets.
On April 2, 2014, China’s Hubei Province launched the country’s sixth regional carbon market. Industries there are expected to cap emissions at 324 million tons this year.
- 2013 – Hubei Emissions Trading Scheme Workshops: To support a successful launch of the pilot ETS in 2014, CCAP and Wuhan University co-hosted two workshops in Wuhan, China, that brought together more than 100 enterprises to understand compliance requirements for enterprises under the Hubei ETS program. The project also explored the applicability of benchmarking allowance allocation methodologies in China—an approach that could later be adopted under a national ETS.
- 2010-2011 – Tsinghua University Tradable Intensity Standard Workshops: CCAP and Tsinghua University co-hosted three workshops in Beijing and Xiamen, China, looking at the pros and cons of different market-based approaches for reducing greenhouse gas emissions in China’s iron and steel, building and electricity sectors. Drawing from the workshop discussions, CCAP and Tsinghua University prepared proposed frameworks recommending application of tradable intensity standards in the iron and steel sector and market approaches for reducing greenhouse gas emissions from new and existing buildings in Xiamen, China.
- 2009-2010 – Power Sector Emissions Abatement Modeling Tool: Tsinghua University and CCAP developed a new dispatch modeling tool to estimate the emissions reductions and costs that would result from different electric sector policies (e.g., base case, with renewable energy targets, with a carbon tax, limits on SO2, and power trades across regions).
- 2007-2009 – Technology-Based Mitigation: CCAP worked with the Shandong local government to evaluate technical options and policy implementation strategies to assist the province in meeting its 2010 energy intensity targets.
Mitigation Action Implementation Network (MAIN)
China is also a participant in CCAP’s Mitigation Action Implementation Network (MAIN) that provides on-the-ground support and technical assistance for countries to design, implement and finance mitigation policies known as nationally appropriate mitigation actions (NAMAs). CCAP has hosted three MAIN dialogues in Asia to convene key ministries, industries, NGOs, and finance experts to build capacity to advance and finance NAMAs
in Asia. Other MAIN-Asia members include: Indonesia, Malaysia, Pakistan, Philippines, Thailand, and Vietnam.
Expertise in Market-Based Solutions
Since 1995, CCAP has firmly established itself as a world leader in researching, analyzing, designing and promoting market-based solutions that successfully reduce greenhouse gas emissions. CCAP’s experience with market mechanisms provides a deep repertoire of design features that can be tailored to individual circumstances to improve political viability, while still considering effectiveness and cost objectives.
Structural Reform for EU Emissions Trading System
CCAP-Europe currently works with European policymakers to restructure the EU Emissions Trading System. In The New Deal: Reforming the EU ETS to Enhance Low-Carbon Industrial Competitiveness, CCAP-Europe outlines ways in which the EU ETS could be the catalyst for long-term economic growth and significant innovation in the European manufacturing sector. The report suggests reducing the surplus of EU allowances, and aligning ETS caps with the long-term climate goal to reduce emissions by 80-95 percent by 2050.