1. China’s Emissions Trading Plan
ETS Pilots
National infrastructure (offsets, registry)
‘Launch’ of the national ETS
Climate change law
Policy issues
Energy liberalisation
Low liquidity
Lack of market products
Transition from pilots to national unclear
Climate Challenges, Market Solutions

2. China’s current ETS’s consists of:
256 million people (18% of total population)
27% of 2010 national GDP
Variety of regions/economic structures
Climate Challenges, Market Solutions

3. China’s National ETS: Features
First phase: 2017 to 2019
Will build off of 7 ETS pilots, but will be a new system
Free allocation based on benchmarking and grandfathering, auctioning will commence around 2020
Allocation will begin next month (Oct 2016)
Carbon leakage lists
National registry, market intervention, innovation fund, and CCER offsets

4. China’s National ETS: Sector Coverage
Power (generation, heat-power cogeneration, and grid operators)
Non-ferrous metals (copper smelting, electrolytic aluminum)
Petrochemicals (crude oil refining and processing, ethylene)
Building production and materials (clinker, plate glass)
Pulp & Paper
Chemicals (methanol, ammonia, carbide)
Aviation (civil commercial, cargo, and airports)
Iron & Steel

5. IETA Views on China’s ETS
National rules for all ETS elements still needed
Foreign participation in ETS strongly encouraged
Allow forward carbon trading
Benchmarking better than grandfathering (allocation trap)
Common infrastructure needed across exchanges
CCER use is good, but need instruction on eligibility and percentage use

6. Additional Resources