"National Carbon Market Development Report (2024)": The construction of the national carbon market is making remarkable progress, the results are gradually demonstrated, and the impact continues to expand
The national carbon market is an important policy tool for China to implement its national strategy to actively respond to climate change and promote the realization of carbon peak and carbon neutrality goals. It is also the main form of China's carbon pricing mechanism. On July 21, the 2024 China Carbon Market Conference was held in Wuhan City, Hubei Province. During the meeting, the "National Carbon Market Development Report (2024)"(hereinafter referred to as the "Report") was released. The national carbon market has been launched for three years. What progress has been made? What are the results? Why has its construction and operation attracted great attention from domestic and foreign society? Based on the content of the "Report" and public data, the reporter sorted out it.
The "National Carbon Market Development Report (2024)" was released at the scene. Photo by Zeng Zhen
The construction of the national carbon market has made remarkable progress
The "Report" shows that after three years of construction and operation, the national carbon emissions trading market institutional framework system has been basically completed, legal guarantees have been strengthened, and supporting technical specifications have been continuously improved, laying a solid foundation for the smooth and orderly operation of the market.
In January 2024, the State Council promulgated the "Interim Regulations on the Management of Carbon Emissions Trading", which clarified the carbon emissions trading and related activity systems for the first time in the form of administrative regulations, so as to ensure that there are no blind spots in coverage, key links are targeted, and penalties are effectively improved. The "Interim Regulations on the Administration of Carbon Emissions Trading", together with the "Measures for the Administration of Carbon Emissions Trading (Trial)" issued by the Ministry of Ecology and Environment and other supporting systems, form a multi-level system covering "administrative regulations + departmental rules + normative documents + technical specifications". Institutional system.
Ensuring the quality of carbon emission data is another important task for the smooth and orderly operation of the national carbon emission trading market. The "Report" summarizes the relevant measures taken by my government to continue to strengthen the quality management of carbon emission data. The reporter noted that by optimizing the accounting and verification methods, the monthly deposit of key data was implemented, and the three-level joint review of "national-province-city" was carried out. Informatization means such as big data were used to intelligently warn data quality risks, and special supervision and assistance were organized., forming a closed-loop management working mechanism of "timely discovery, transfer and supervision, verification and rectification" of problems, and the data quality was effectively guaranteed, meeting the data needs for the smooth and orderly operation of the national carbon emissions trading market.
It is worth mentioning that in order to ensure data quality, since 2021, the Ministry of Ecology and Environment has organized three rounds of quality supervision and assistance for carbon emission reports of key emission units, and dispatched experts and law enforcement backbones across provinces to provide on-site supervision to 538 key emission units distributed in 25 provinces and 73 cities. Classify and dispose of discovered problems, formulate cancellation standards, draw up accounts, and rectify them item by item. At the same time, we will continue to follow up on the rectification and implementation of issues in the first performance cycle. A total of 54 administrative penalties have been imposed on data quality problems in various places, and the penalties have been filed and quotas have been reduced equivalent to a market value of approximately 1.4 billion yuan.
Look at development through data. "As of the end of 2023, the cumulative transaction volume of carbon emission quotas in the national carbon emissions trading market was 442 million tons, with a cumulative transaction volume of 24.919 billion yuan. Among them, the cumulative transaction volume of carbon emission quotas in the second performance cycle was 263 million tons, with a cumulative transaction volume of 17.258 billion yuan. The transaction scale has gradually expanded, transaction prices have stabilized and increased, and trading entities have become more active." The "Report" publishes and analyzes the market transactions in the second performance cycle (2021 and 2022) of the national carbon emissions trading market. The "Report" shows that the second performance cycle of the national carbon emissions trading market included a total of 2257 key emission units in the power generation industry (including self-owned power plants in other industries), covering annual greenhouse gas emissions of approximately 5.1 billion tons of carbon dioxide equivalent.
The development results of the national carbon market are gradually demonstrated
The national carbon market has consolidated the main responsibility of enterprises for carbon emission reduction and established enterprises 'low-carbon awareness that "carbon emission has costs and carbon reduction has benefits". The "Report" shows: "Compared with mandatory production and emission restrictions, the carbon emissions trading mechanism allocates carbon emission resources through market means, and enterprises 'emission reduction methods are more flexible and more conducive to promoting industry emission reduction." On the premise of ensuring the rapid development and energy security of the power industry, the national thermal power carbon emission intensity (carbon dioxide emissions per unit of thermal power generation) in 2023 will decrease by 2.38% compared with 2018, and the power carbon emission intensity (carbon dioxide emissions per unit of power generation) has dropped by 8.78% compared with 2018. The carbon market promotes greenhouse gas emission reduction, promotes energy structure adjustment, and encourages advanced and backward constraints is more obvious.
On April 24, 2024, the closing price of the national carbon emissions trading market exceeded 100 yuan per ton for the first time. The green financial attributes of carbon emission rights have gradually gained market recognition. The national carbon market transaction prices have anchored benchmark prices for climate investment and financing, carbon asset management, quota pledges, etc., leveraging more green and low-carbon investment, and promoting the thermal power industry. Energy efficiency improvement and energy structure adjustment have shown a positive role in promoting green, low-carbon and high-quality development.
Based on China's actual situation, my country has explored and established a carbon emission accounting system for key industries, which provides key data support for the formulation and release of China's annual power carbon dioxide emission factors, regional power grid baseline emission factors, and the establishment and improvement of a carbon footprint management system.
In recent years, my country has cultivated a large number of professional talents and related institutions by strengthening institutional management, clarifying responsibilities and obligations, optimizing technical specifications, and strengthening supervision and inspection, laying a solid foundation for promoting the realization of the "double carbon" goal. According to statistics from the "Report", in 2023, there will be more than 50 consulting agencies, more than 450 inspection and testing agencies, and nearly 100 verification agencies in my country providing third-party technical services to key emission units and government authorities. The provincial ecological and environmental authorities evaluated the services of the verification agency. Among the 16,600 evaluation results on work timeliness and work quality, the qualified proportion reached 99.7%.
The development impact of the national carbon market continues to expand
Why has the construction and operation of the national carbon market attracted great attention from the international community? The "Report" explains the reasons. On the one hand, the national carbon emissions trading market started with the power generation industry and launched online trading in July 2021. It now includes 2257 key emission units, covering approximately 5.1 billion tons of carbon dioxide emissions annually, accounting for more than 40% of the country's carbon dioxide emissions., becoming the world's largest market covering greenhouse gas emissions.
On the other hand, in January 2024, the National Voluntary Greenhouse Gas Emission Reduction Trading Market was officially launched, which is another policy tool to promote the realization of the "double carbon" goal after the National Carbon Emissions Trading Market. The mandatory carbon market strictly controls the emission behavior of key emission units. The voluntary carbon market encourages extensive participation by the whole society. The two carbon markets operate independently and are connected to each other through a quota payment and offset mechanism. The two together constitute the national carbon market system.
Our government attaches great importance to international cooperation in the national carbon market, which is another important reason why the development impact of the national carbon market continues to expand. The "Report" shows that since the launch of the national carbon market, my country has carried out multi-level exchanges, dialogues and practical cooperation with the European Union, Germany, Norway, BRICS countries, and countries jointly building the "Belt and Road" around the construction of carbon market systems. Continue to carry out China-EU Ministerial Dialogue on Carbon Emissions Trading Policies, hold the "China Carbon Market Conference 2023·Shanghai", share experiences and mutual learning, carry out various forms of carbon market capacity building activities, and consolidate the foundation for carbon market implementation. China's carbon market has an important influence on the global carbon price level and the effectiveness of carbon trading mechanisms. The construction and operation of the national carbon market have attracted great attention from the international community. China's quota allocation method based on carbon emission intensity control goals demonstrates the flexibility and applicability advantages of the carbon market mechanism, and contributes the "China Plan" to the innovation of global carbon market mechanism.
Today, the innovative development of China's carbon market is encouraging market entities to innovate in green and low-carbon technologies with higher efficiency and lower cost, providing inexhaustible impetus for the development of new quality productivity.
