China to launch domestic carbon trading -report

Thu Jul 22, 2010 4:11am GMT
 

BEIJING, July 22 (Reuters) - China will launch domestic carbon trading during the next five years, the China Daily reported on Thursday, citing a closed-door meeting of officials from ministries, enterprises and think tanks.

Officials have reached consensus on the need for carbon trading as a way to help China meet its target to improve energy efficiency by 2020, but there is still no agreement on the mechanism that should be used, the paper said.

China is still struggling to achieve a target to cut energy intensity -- defined as the amount of energy used to generate one unit of gross domestic product -- by 20 percent between 2006 and the end of 2010.

Efforts to hit that target have focused on administrative tools, such as contracts in which the top 1,000 energy consumers promised the government to improve their energy efficiency, but the meeting agreed such measures would be too expensive in future, the paper said.

It quoted one participant, Tang Renhu from the low-carbon centre at China Datang Corp, a major power generator, as saying there were differences over whether pilot projects should start from one industry or a certain area.

Possible sectors for pilot carbon trading schemes were carbon-intensive industries such as coal-fired power generation, he said.

China already has some voluntary carbon trading. The plan to introduce wider carbon trading would be strictly separated from ongoing international negotiations for a successor to the Kyoto Protocol, an unnamed participant at the meeting told the paper.

China has surpassed the United States as the world's top emitter of greenhouse gases and is struggling to reduce emissions and pollution because of its reliance on coal, a cheap but dirty fossil fuel.

It is also expected to become the world's top energy user, although the precise moment of reaching that milestone is debated. China's National Energy Administration this week rejected an assessment by the International Energy Agency that China was already using more energy than the United States. [ID:nTOE66J02Y]   Continued...

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