Study on the benchmark method for national carbon trading in China’s iron and steel industry

doi:10.12006/j.issn.1673-1719.2020.248

Abstract

Abstract:

The national carbon emission trading scheme has been constantly improving since 2011, and the benchmark method has been determined as the major one of carbon allowance allocation. The iron and steel industry, which is the second largest contributor of energy consumption and carbon emission after the electric-power industry in China, is playing a significant role in improving the national carbon emission trading market. As a result, it is of great necessity to speed up calculation, design and evaluation of the carbon trading by benchmark methodology. Based on the data submitted directly from iron and steel enterprises to the government in 2018 and the carbon intensity per unit of product, which is the key indicator of iron and steel benchmark, this paper has determined the benchmark methodology for the national iron and steel industry carbon trading. The analysis results show that the benchmark of the iron and steel industry should include steel making and the previous six processes. The average carbon intensity of top 70% or 80% efficient enterprises is recommended as the benchmark. Furthermore, there is no need to consider the regional differences of enterprises in actual practice. However, a transition period should be set from historical method to benchmark method for some progresses where big differences exist among enterprises.

Key words: Carbon trading, Benchmark method, Carbon intensity, Iron and steel industry

TAN Qi-Lu, LIU Lan-Ting, ZHU Song-Li. Study on the benchmark method for national carbon trading in China’s iron and steel industry[J]. Climate Change Research, 2021, 17(5): 590-597.

Figures/Tables 7

Fig. 1 Distribution of carbon emissions for reported iron and steel enterprises in 2018

Fig. 2 Box-plot map of each benchmark lines in China iron and steel industry

Fig. 3 Comparison of mean values of each benchmark line in China’s iron and steel industry aith benchmarks in other regions

Table 1 The average carbon intensity of each benchmark line under different percentages of reported iron and steel enterprises in 2018

Table 2 Analysis of allowances surplus and shortage based on benchmark methodology in China’s iron and steel industry in 2018

Fig. 4 Distribution of the three types of enterprises with high, medium and low carbon dioxide emissions intensity in the iron and steel industry

Table 3 Results of index analysis for iron and steel industry in 2018

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