Carbon price doubles in three years, carbon market upgrade and expansion approaching
2024-07-16
On July 16th, the National Carbon Emission Trading Market (hereinafter referred to as the "National Carbon Market") officially launched and traded for three years. According to data released by the Shanghai Environment and Energy Exchange, the closing price of the national carbon market on the 15th was 87.05 yuan/ton, which has nearly doubled compared to the opening price of 48 yuan/ton on the first day of the launch of the national carbon market. Standing at a new starting point, accelerating the upgrading and expansion of the carbon market has become an important issue for the next step of national carbon market construction. The allocation of quotas in the power generation industry has been optimized and improved, and the expansion of the national carbon market is also accelerating. It is expected that the cement and aluminum smelting industries may be the first to be included. China's carbon market was officially launched on July 16, 2021, with a total of 2162 key emission units in the power generation industry included in the first compliance cycle, covering an annual carbon dioxide emissions of approximately 4.5 billion tons; In the second performance cycle, a total of 2257 key emission units in the power generation industry were included, with an annual coverage of over 5 billion tons of carbon dioxide emissions. From the perspective of tradable carbon dioxide emissions, it is the largest carbon market in the world. Since the beginning of this year, the construction of the national carbon market has gradually accelerated. After the restart of the National Certified Voluntary Emission Reduction (CCER) market in January, the Interim Regulations on the Administration of Carbon Emission Trading were officially implemented on May 1st, providing a clear legal basis for the operation and management of the national carbon emission trading market. Over the past three years, the overall market operation has been stable. After entering the second fulfillment cycle, the trading volume of the national carbon market increased by 19% compared to the first fulfillment cycle, the trading volume increased by 89%, and the number of participating companies increased by nearly 50%. As of July 15th, the cumulative trading volume of carbon emission quotas in the national carbon market was 465 million tons, with a cumulative trading volume of 26.97 billion yuan. Through two performance cycles, the carbon reduction cost of the national power industry has been reduced by about 35 billion yuan. Currently, the allocated quota for the two performance cycles exceeds 19 billion tons, and based on current market prices, asset prices exceed 1.5 trillion yuan Zhu Guohui, Vice Chairman of Carbon Emission Registration and Settlement (Wuhan) Co., Ltd., pointed out that the role of the national carbon market price discovery mechanism has initially emerged, enhancing the low-carbon development awareness of enterprises that "carbon emissions have costs, carbon reduction has benefits". At present, China's carbon market has entered its third compliance cycle. On July 2nd, the Ministry of Ecology and Environment publicly solicited opinions on the "2023 and 2024 National Carbon Emission Trading Power Generation Industry Quota Total Amount and Allocation Plan (Draft for Comments)". Zhang Jingjie, Deputy Director of the Planning and Development Department of the China Electricity Council, stated in an interview with the Economic Reference News that this draft for soliciting opinions is a moderate adjustment to the carbon emission benchmark values for 2023 and 2024, which to some extent balances the requirements of low-carbon development and the pressure on enterprises to fulfill their obligations; The second is to simplify the quota calculation process and parameters, reduce the complexity and uncertainty of enterprises in the execution process, and improve the operational efficiency of the carbon market; Thirdly, the quota transfer rules have been proposed, and the carbon market system has been improved, which helps to enhance the liquidity of the carbon market. It is reported that the next step for the power industry is to study quota allocation schemes that meet the requirements of the new power system under the "dual carbon" target. Continuously strengthen the quality management of carbon emission data. Strengthen the research on the collaborative mechanism between carbon market and electricity market. Strengthen the construction of carbon trading capacity and do a good job in evaluating the professional competence level of carbon emission managers. At the same time, the conditions for expanding the carbon market are gradually maturing. Song Yutong, an analyst at the Carbon Research Group of the London Stock Exchange Group, believes that on the one hand, there are already carbon market pilot projects that have incorporated some industrial industries for control, accumulating experience; On the other hand, carbon emission reporting and verification work in the industrial sector has been ongoing and has a data foundation. In the first half of this year, the Ministry of Ecology and Environment successively released draft guidelines for carbon emission accounting, reporting, and verification in the aluminum smelting industry and cement clinker industry, which is seen as a strong signal for the expansion of the carbon market. In addition, key emission industries such as steel, non-ferrous metals, and building materials that have been included in the national carbon market sequence have also carried out preparations for carbon emission reporting and verification. Relevant accounting and reporting guidelines, as well as verification technical guidelines, have begun to solicit opinions from all parties. (New Society)
Edit：NingChangRun Responsible editor：LiaoXin
Source：China Daily
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