China has so far launched a total of five pilot carbon emission trading markets in major Chinese cities as part of an intensifying effort to rein in the impact of its fast economic growth on the environment.
Li Dong has more.
The latest, or the fifth emissions trading market was established in the northern Chinese city of Tianjin on Dec. 26. Five trade deals for a total of 45,000 tons of carbon emissions worth 1.25 million yuan were announced at the market's launch ceremony.
Xie Zhenhua, vice chairman of the National Development and Reform Commission says the creation of the Tianjin carbon emissions trading market marked a breakthrough in China.
He says he hopes the government will speed up the enactment of supervision rules and regulations, continuously boost market activity, and enhance cooperation between markets of different regions.
"The Chinese government made a commitment to the world at the 2009 Copenhagen Summit that we will reduce carbon dioxide emissions by 40 percent to 45 percent per unit of GDP by 2020. That's our commitment to the outside world. We have introduced this carbon emission trading mechanism which, in fact, is a market mechanism. We hope to realize our goal of cutting carbon dioxide emissions through a market approach."
Apart from Tianjin, similar carbon trading markets have also been set up in Beijing, Shanghai, Shenzhen and Guangdong Province.
Analysts say the year of 2013 ushered in an era of carbon emission trading in China and marked the beginning of trading environmental resources as commodities.
China's current approach to carbon emissions trading allows the government to allocate an annual carbon emission quota to a list of companies included in the scheme when their carbon emissions reach a certain level.
These companies have to pay for each ton of carbon they emit beyond the cap given by the government. They are energy-intensive companies, including iron and steel producers, chemical facilities, power and heat generators, as well as oil and gas exploiters.
A total of 114 companies with annual carbon dioxide emissions of over 20,000 tons since 2009 have been included in the pilot scheme in Tianjin. Xie Zhenhua says these companies can buy or sell emission permits within the markets to fulfill their responsibilities for curbing emissions.
"We have launched pilot carbon trading markets, not because we hope to see rapid growth in the markets, but because we intend to establish an emissions trading mechanism in China which is in accordance with our country's conditions, or the conditions of a developing country. We hope to acquire experience through these pilot markets and then set up a national carbon emissions trading market."
Analysts say carbon emissions trading is actually a market approach to save energy and reduce greenhouse gas emissions which cannot be achieved by administrative means alone.
For CRI, I am Li Dong.