IDEAS home Printed from https://ideas.repec.org/a/sae/engenv/v25y2014i5p899-913.html
   My bibliography  Save this article

Regional Pilot Carbon Emissions Trading and its Prospects in China

Author

Listed:
  • Shih-Fang Lo
  • Mei-Ching Chang

Abstract

As the world's largest CO 2 emitting country, China may become the largest carbon trading market in the future. While building an emissions trading scheme (ETS) is becoming one of the major policies being adopted to reduce CO2 emissions in most developed countries, the government of China has declared and implemented regional pilot emissions trading schemes in seven municipalities and provinces. This study reviews the history of the emissions trading policy and discusses the lessons learned. From an economic perspective, we further estimate the potential structure of the pilot jurisdictions in China, including overall trading emissions, the number of enterprises included, and the industrial structure across the pilot ETSs. It is speculated that challenges arise from the inherent size and highly-concentrated industrial structure of the pilot ETSs. Inter-pilot trading and regulatory harmonization are necessary to boost trading and liquidity in the future.

Suggested Citation

  • Shih-Fang Lo & Mei-Ching Chang, 2014. "Regional Pilot Carbon Emissions Trading and its Prospects in China," Energy & Environment, , vol. 25(5), pages 899-913, July.
    • Handle: RePEc:sae:engenv:v:25:y:2014:i:5:p:899-913
    DOI: 10.1260/0958-305X.25.5.899
    as

    Download full text from publisher

    File URL: https://journals.sagepub.com/doi/10.1260/0958-305X.25.5.899
    Download Restriction: no
    File URL: https://libkey.io/10.1260/0958-305X.25.5.899?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Chang, Ching-Chih, 2010. "A multivariate causality test of carbon dioxide emissions, energy consumption and economic growth in China," Applied Energy, Elsevier, vol. 87(11), pages 3533-3537, November.
    2. Hu, Yuan, 2007. "Implementation of voluntary agreements for energy efficiency in China," Energy Policy, Elsevier, vol. 35(11), pages 5541-5548, November.
    3. R. H. Coase, 2013. "The Problem of Social Cost," Journal of Law and Economics, University of Chicago Press, vol. 56(4), pages 837-877.
    4. Krupnick, Alan & Bell, Ruth & Morgenstern, Richard & Anderson, Robert & Abegunawardena, Piya & Schreifels, Jeremy & Dong, Cao & Jinan, Wang & Jitian, Wang & Larsen, Steiner, 2004. "Emissions Trading to Improve Air Quality in an Industrial City in the People's Republic of China," RFF Working Paper Series dp-04-16, Resources for the Future.
    5. Karl-Martin Ehrhart & Christian Hoppe & Joachim Schleich & Stefan Seifert, 2003. "Strategic Aspects of Co2-Emissions Trading: Theoretical Concepts and Empirical Findings," Energy & Environment, , vol. 14(5), pages 579-597, September.
    6. Lorraine Sugar & Christopher Kennedy & Edward Leman, 2012. "Greenhouse Gas Emissions from Chinese Cities," Journal of Industrial Ecology, Yale University, vol. 16(4), pages 552-563, August.
    7. Regina Betz & Wolfgang Eichhammer & Joachim Schleich, 2004. "Designing National Allocation Plans for Eu-Emissions Trading — A First Analysis of the Outcomes," Energy & Environment, , vol. 15(3), pages 375-425, July.
    8. Bi, Jun & Zhang, Rongrong & Wang, Haikun & Liu, Miaomiao & Wu, Yi, 2011. "The benchmarks of carbon emissions and policy implications for China's cities: Case of Nanjing," Energy Policy, Elsevier, vol. 39(9), pages 4785-4794, September.
    9. Michael Wara, 2007. "Is the global carbon market working?," Nature, Nature, vol. 445(7128), pages 595-596, February.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Chang, Kai & Ye, Zhifang & Wang, Weihong, 2019. "Volatility spillover effect and dynamic correlation between regional emissions allowances and fossil energy markets: New evidence from China’s emissions trading scheme pilots," Energy, Elsevier, vol. 185(C), pages 1314-1324.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Chen, Chunhua & Jiang, Dequan & Lan, Meng & Li, Weiping & Ye, Ling, 2022. "Does environmental regulation affect labor investment Efficiency?Evidence from a quasi-natural experiment in China," International Review of Economics & Finance, Elsevier, vol. 80(C), pages 82-95.
    2. Cai, Bofeng & Lu, Jun & Wang, Jinnan & Dong, Huijuan & Liu, Xiaoman & Chen, Yang & Chen, Zhanming & Cong, Jianhui & Cui, Zhipeng & Dai, Chunyan & Fang, Kai & Feng, Tong & Guo, Jie & Li, Fen & Meng, Fa, 2019. "A benchmark city-level carbon dioxide emission inventory for China in 2005," Applied Energy, Elsevier, vol. 233, pages 659-673.
    3. Ye, Bin & Jiang, JingJing & Li, Changsheng & Miao, Lixin & Tang, Jie, 2017. "Quantification and driving force analysis of provincial-level carbon emissions in China," Applied Energy, Elsevier, vol. 198(C), pages 223-238.
    4. MacKenzie, Donald, 2009. "Making things the same: Gases, emission rights and the politics of carbon markets," Accounting, Organizations and Society, Elsevier, vol. 34(3-4), pages 440-455, April.
    5. Christoph Weber & Philip Vogel & Oliver Woll, 2007. "Modelling the impact of different permit allocation rules on optimal power plant portfolios," EWL Working Papers 0703, University of Duisburg-Essen, Chair for Management Science and Energy Economics, revised Aug 2007.
    6. Wang, Chen & Engels, Anita & Wang, Zhaohua, 2018. "Overview of research on China's transition to low-carbon development: The role of cities, technologies, industries and the energy system," Renewable and Sustainable Energy Reviews, Elsevier, vol. 81(P1), pages 1350-1364.
    7. Yu-Jie Hu & Lishan Yang & Fali Duan & Honglei Wang & Chengjiang Li, 2022. "A Scientometric Analysis and Review of the Emissions Trading System," Energies, MDPI, vol. 15(12), pages 1-20, June.
    8. Lohmann, Larry, 2009. "Toward a different debate in environmental accounting: The cases of carbon and cost-benefit," Accounting, Organizations and Society, Elsevier, vol. 34(3-4), pages 499-534, April.
    9. Zhang, Jiawei & Liu, Miaomiao & Bi, Jun, 2022. "Urban greenhouse gas emission peaking paths and embedded health co-benefits: A multicases comparison study in China," Applied Energy, Elsevier, vol. 311(C).
    10. Persson, Torsten & Tabellini, Guido, 2002. "Political economics and public finance," Handbook of Public Economics, in: A. J. Auerbach & M. Feldstein (ed.), Handbook of Public Economics, edition 1, volume 3, chapter 24, pages 1549-1659, Elsevier.
    11. Qiuyue Xia & Lu Li & Jie Dong & Bin Zhang, 2021. "Reduction Effect and Mechanism Analysis of Carbon Trading Policy on Carbon Emissions from Land Use," Sustainability, MDPI, vol. 13(17), pages 1-22, August.
    12. Frans P. Vries & Nick Hanley, 2016. "Incentive-Based Policy Design for Pollution Control and Biodiversity Conservation: A Review," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 63(4), pages 687-702, April.
    13. Usher, Dan, 2001. "Personal goods, efficiency and the law," European Journal of Political Economy, Elsevier, vol. 17(4), pages 673-703, November.
    14. George Tridimas & Stanley L. Winer, 2018. "On the Definition and Nature of Fiscal Coercion," Carleton Economic Papers 18-09, Carleton University, Department of Economics.
    15. Mario Jametti & Thomas von Ungern-Sternberg, 2005. "Assessing the Efficiency of an Insurance Provider—A Measurement Error Approach," The Geneva Risk and Insurance Review, Palgrave Macmillan;International Association for the Study of Insurance Economics (The Geneva Association), vol. 30(1), pages 15-34, June.
    16. Stephanie Rosenkranz & Patrick W. Schmitz, 2007. "Can Coasean Bargaining Justify Pigouvian Taxation?," Economica, London School of Economics and Political Science, vol. 74(296), pages 573-585, November.
    17. Stefan Ambec & Yann Kervinio, 2016. "Cooperative decision-making for the provision of a locally undesirable facility," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 46(1), pages 119-155, January.
    18. Liu, Duan & Yu, Nizhou & Wan, Hong, 2022. "Does water rights trading affect corporate investment? The role of resource allocation and risk mitigation channels," Economic Modelling, Elsevier, vol. 117(C).
    19. Valcu-Lisman, Adriana & Weninger, Quinn, 2012. "Markov-Perfect rent dissipation in rights-based fisheries," ISU General Staff Papers 201209260700001037, Iowa State University, Department of Economics.
    20. Hausknost, Daniel & Grima, Nelson & Singh, Simron Jit, 2017. "The political dimensions of Payments for Ecosystem Services (PES): Cascade or stairway?," Ecological Economics, Elsevier, vol. 131(C), pages 109-118.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:sae:engenv:v:25:y:2014:i:5:p:899-913. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: SAGE Publications (email available below). General contact details of provider: .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.