April 3, 2014 / 9:19 AM / 6 years ago

China's Shenzhen issues 2014 carbon permits

WUHAN/BEIJING, April 3 (Reuters) - Authorities in China’s southern city of Shenzhen, China’s oldest carbon market, said on Thursday they had issued around 30 million carbon permits for the 2014 compliance year to participants in its emissions trading scheme.

The market, launched last June, regulates carbon dioxide emissions from more than 630 local companies as part of China’s efforts to rein in rapid growth of greenhouse gas emissions.

The issue of permits for the current calendar year ensures trading can continue, as China’s emission markets only allow spot trading.

The Shenzhen government said last year it would issue a total of around 100 million permits for the period from 2013 to 2015, although some of them would be held in government reserves to supply new facilities and damp sudden price spikes.

Last month, vice mayor Tang Jie said the market ended with a surplus of 10 percent for 2013, although final data has not been published.

Market rules allow the government to adjust annual handouts to companies based on production data, meaning some of the 2013 surplus could be withdrawn if production by companies fell short of plans.

Regulator the Development and Reform Commission said it would expand the scheme this year by lowering the threshold to include companies that emit 3,000 tonnes of carbon dioxide per year, down from 5,000 tonnes previously.

It did not say how many facilities would be affected by the new rules, or whether the government would issue extra permits for the new participants.

Shenzhen carbon permits closed Thursday at 80 yuan ($12.88), up half a yuan from the previous day. They are the world’s most expensive CO2 permits, but the volume of trade is very low. (Reporting by Kathy Chen and Stian Reklev; Editing by Clarence Fernandez)

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