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By Mathew Carr
Jan. 5, 2021 — LONDON: I wanted to highlight this key opinion — of a reporter who’s followed the development of China’s national carbon market for many years.
After almost a decade in the making, China’s national CO2 emissions trading scheme is now pretty much here. Loads of ppl are going to have loads of opinions, as they should. Having covered the whole painful process, here are some thoughts from me, fwiw:
— Stian Reklev (@StianReklev) January 5, 2021
It starts out quite shit, but with the full structure in place, the government can turn it into a useful tool overnight IF it wants to. Big if and not likely to be done for a while (it took NZ over a decade).
— Stian Reklev (@StianReklev) January 5, 2021
My response:
Love your use of the technical term “shit” here …I find it fascinating that China is beating the #USA to this #climatechange punch…embracing markets where the “leader” of the “free” world won’t so far@johnkerry
— Mathew Carr (@carrzee) January 5, 2021
There are going to be loads of problems first few years, and no doubt a few scandals. Data quality a huge issue, made more urgent by decision to leave provincial governments in charge of verification.
— Stian Reklev (@StianReklev) January 5, 2021
Most worryingly, China’s gut instinct to always publish as little data as possible risks eliminating any credibility the ETS could ever hope for. If market fundamentals are kept secret and scandals hushed, it’ll be a serious reputational burden.
— Stian Reklev (@StianReklev) January 5, 2021
But – and this is the whole point of even paying attention – the minute China wants to put the ETS to work, it can be efficient. Absolute and decreasing cap, transparent data, coordinate with energy/industry depts. Over to you, 11. #OCTT ?end
— Stian Reklev (@StianReklev) January 5, 2021
A not-stupid question:
Sorry for maybe a stupid question, but will these carbon credits be avilable for international investors to buy up? Can there become a linked EU-China emissions trading market, through middlemen?
— Loukas Christodoulou (@Loukas_RS) January 5, 2021
China only for now, it looks like from the rules, though they don’t specify. I’m sure EU/US/JP/AU traders will find a way to get involved if they want to though. Joint ventures with local firms etc. Linked EU-China market is a pipe dream for another 10 years, I think.
— Stian Reklev (@StianReklev) January 5, 2021
Another not-stupid question:
Thank you! I think what's fascinating is how you say it could all change fast if the pressure/demand was there, and I'm trying to imagine which circumstances could give it that hefty shove.
— Loukas Christodoulou (@Loukas_RS) January 5, 2021
Hefty shove the whole world doesn’t want?
A major climate event such as the flooding of Shanghai…I seriously hope it won’t come to that…but leaders don’t seem to want to “be” the change …and China’s negotiation stance threatening more coal is understandable given Trump’s Paris pullout
— Mathew Carr (@carrzee) January 5, 2021
(More to come. I will seek responses from the China and the U.S. governments)
Hi - I'm Mathew Carr — a reporter with 30 years experience covering markets, business, politics, finance and marketing. I’ve worked for news outfits huge and small, and was one of the first to recognise the importance of the EU carbon market 17 years ago, which is becoming the global benchmark in climate protection View all posts by mathew carr
