Today is Thursday, February 8, 2024.
"Sleeping Carbon Giant Awakes: China’s renewed voluntary carbon markets is here - What you need to know".
This is the title of a featured insight by King & Wood Mallesons (KWM), the largest law firm in Asia. You may recall a post from September 2023 when we had already referred to their great insights.
Effective on May 1, 2024, Chinese Premier Li Qiang has signed a decree, introducing new regulations governing carbon emissions trading.
The China Certified Emission Reductions (CCER) market is a "critical step towards China reaching its ‘30.60’ decarbonisation target: peak emissions by 2030 and carbon neutrality by 2060".
The Compliance Carbon Market (CCM) – the National Emissions Trading Scheme (National ETS) - will cover about 2,000 entities from the power generation industry, while China’s Voluntary Carbon Market (VCM) will be centred on the issuance and trade of CCER by other businesses and individuals.
CCM participants will be allowed to offset up to 5% of emissions using credits from the VCM.
According to KWM, all projects applying for CCER should essentially relate to:
Carbon mitigation: reduce existing GHG emissions, and
Carbon sequestration: increase the absorption and removal of GHG.
And meet the following criteria:
Authenticity in terms of transparency, third-party validation and verification, integrity and penalties,
Uniqueness, no double counting,
Additionality, compared with the baseline scenario.
Ministry of Ecology and Environment (MEE) is already working on a set of methodologies, targeted to the VCM. Here are three examples (in Chinese):
There is also the interesting - and very sensible - ‘principle of conservatism’.
Click at the image below to read about this principle at the complete featured insight by KWM, including how the Registration Authority and the Trading Institution - China Beijing Green Exchange - will operate.
There are also these articles from China Daily, "China releases carbon emissions trading regulations" and "Regulation to control carbon trading unveiled".
The "fast-forward" button of the Chinese CCER was finally hit.
Tomorrow, February 9, another important post about China.
