Research on the pathways of carbon market development: international experiences and implications for China

doi:10.12006/j.issn.1673-1719.2018.165

Abstract

Abstract:

Based on the development history of the typical international carbon market, this study established an evaluation index system composed of 32 sub-indicators, measured from the four dimensions of political appeal, decision-making environment, economic base, and market foundation. In depth analysis is conducted on European Emissions Trading System (EU ETS), Regional Greenhouse Gas Initiative (RGGI), Western Climate Initiative (WCI) etc., in order to summarize the common criteria for different types of international carbon markets and find out which type of market is most suitable for China. The establishment of a cross-border coalition-based carbon market usually considers three key points: close economic links, high cost of abatement in individual regions, and proximity of geographical locations. The establishment of national carbon markets usually takes into consideration the national mandatory emission reduction responsibilities, strong demand for energy structure transformation, and stable national legislation protection. The establishment of regional carbon markets usually includes conditions such as strong regional emission reduction requirements and lack of national legislation of emission rights. The prerequisites for the establishment of industry-based carbon markets include four characteristics: high concentration of greenhouse gas (GHG) emissions, protection of industrial competitiveness, increases in demand of key emission industries, and solid foundation for industrial emission data. Therefore, this study proposes that China’s carbon market development should consider combination of industry-based and cross-border coalition-based carbon markets, further improve the effectiveness of regulatory policy system, accelerate the collection of local GHG emission inventory data, and strengthen local capacity building so as to achieve the dual goals of GHG emission reduction and industrial restructuring and upgrading through the carbon market.

Key words: Market type, Market environment, Carbon market, International experience

Lan YI,Qian HE,Zhao-Peng LI,Li YANG. Research on the pathways of carbon market development: international experiences and implications for China[J]. Climate Change Research, 2019, 15(3): 232-245.

Figures/Tables 5

Fig. 1 The classification results of typical international carbon markets

Fig. 2 The framework system of carbon market establishment background and foundation

Table 1 International typical carbon market establishment background and condition

Fig. 3 Indicators distribution map of China’s carbon market establishment background and conditions

Appendix 1 Definition and data sources of carbon market establishment background and condition indicators

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