Advertisement

A comparative analysis of Chinese regional climate regulation policy: ETS as an example

  • Jingjing JiangEmail author
  • Bin Ye
Original Paper

Abstract

An effective and powerful regulation is indispensable for the development and smooth operation of a cap-and-trade emission trading scheme (ETS). Seven regional pilot ETSs have been established and gradually improved in China, from which the experiences and lessons learned may provide useful references to facilitate China’s national ETS regulation. This article systematically reviews and compares the practices and policies of carbon trading regulation in China’s seven pilot schemes from three major aspects of regulatory institutions and subjects, regulatory objects and content, and regulatory means and techniques, and covering both internal and external regulatory architectures. The comparative analysis has demonstrated that the regional pilot schemes have made notable achievements in developing ETS regulatory systems with Chinese characteristics, but they still have considerable deficiencies. Referencing both international and domestic pilot experiences, this study recommends that China’s national ETS improve regulatory institutional basis, foster an extensive participation of pluralistic regulatory subjects with a clear division of powers and responsibilities, establish effective regulatory systems on carbon finance, and continuously enrich regulatory techniques and platforms.

Keywords

Climate regulation Carbon trading Comparative analysis Regional pilots China 

Notes

Acknowledgements

This study is very grateful for the support of the Natural Science Foundation of Guangdong Province (Grant No. 2017A030313442) and the National Natural Science Foundation of China (Grant Nos. 71603110 and 71803074). Additional support was provided by the Discipline Development Project of the Harbin Institute of Technology (Shenzhen) on Combating Climate Change and Low-Carbon Economics, and by the Southern University of Science and Technology (Grant No. G01296001).

References

  1. Alexander, M., Priest, S., & Mees, H. (2016). A framework for evaluating flood risk governance. Environmental Science & Policy, 64, 38–47.CrossRefGoogle Scholar
  2. Balietti, A. C. (2015). Trader types and volatility of emission allowance prices. Evidence from EU ETS phase I. Energy Policy, 98, 607–620.CrossRefGoogle Scholar
  3. Briggs, D. J., Sabel, C. E., & Lee, K. (2009). Uncertainty in epidemiology and health risk and impact assessment. Environmental Geochemistry and Health, 31, 189–203.CrossRefGoogle Scholar
  4. Brunet, M., & Aubry, M. (2016). The three dimensions of a governance framework for major public projects. International Journal of Project Management, 34, 1596–1607.CrossRefGoogle Scholar
  5. Clayton, M., Richard, D. M., Zhong, M. W., & Xu, L. (2016). Assessing the design of three carbon trading pilot programs in China. Energy Policy, 96, 688–699.CrossRefGoogle Scholar
  6. Cullenward, D. (2014). Leakage in California’s carbon market. The Electricity Journal, 27, 36–48.CrossRefGoogle Scholar
  7. Cullenward, D., & Coghlan, A. (2016). Structural oversupply and credibility in California’s carbon market. The Electricity Journal, 29(5), 7–14.CrossRefGoogle Scholar
  8. Daskalakis, G. (2013). On the efficiency of the European carbon market: new evidence from Phase II. Energy Policy, 54, 369–375.CrossRefGoogle Scholar
  9. Diaz, D., & Moore, F. (2017). Quantifying the economic risks of climate change. Nature Climate Change, 7, 774–782.CrossRefGoogle Scholar
  10. Fan, J. H., & Todorova, N. (2017). Dynamics of China’s carbon prices in the pilot trading phase. Applied Energy, 208, 1452–1467.CrossRefGoogle Scholar
  11. Fan, R. G., Dong, L. L., Yang, W. G., & Sun, J. Q. (2017). Study on the optimal supervision strategy of government low-carbon subsidy and the corresponding efficiency and stability in the small-world network context. Journal of Cleaner Production, 168, 536–550.CrossRefGoogle Scholar
  12. Gilley, B. (2012). Authoritarian environmentalism and China’s response to climate change. Environmental Politics, 21(2), 287–307.CrossRefGoogle Scholar
  13. Gregory, R. (2014). Assessing ‘good governance’: ‘scientific’ measurement and political discourse. Policy Quarterly, 10(1), 15–25.CrossRefGoogle Scholar
  14. Hu, Y. J., Li, X. Y., & Tang, B. J. (2017). Assessing the operational performance and maturity of the carbon trading pilot program: The case study of Beijing’s carbon market. Journal of Cleaner Production, 161, 1263–1274.CrossRefGoogle Scholar
  15. Intergovermental Panel on Climate Change (IPCC). (2014). Climate change 2014: synthesis report. contribution of working groups I, II and III to the fifth assessment report of the intergovernmental panel on climate change [Core Writing Team, R.K. Pachauri and L.A. Meyer (eds.)], Geneva, Switzerland.Google Scholar
  16. Jiang, J. J., Xie, D. J., Ye, B., Shen, B., & Chen, Z. M. (2016). Research on China’s cap-and-trade carbon emission trading scheme: Overview and outlook. Applied Energy, 178, 902–917.CrossRefGoogle Scholar
  17. Jotzo, F., & Löschel, A. (2014). Emissions trading in China: Emerging experiences and international lessons. Energy Policy, 75, 3–8.CrossRefGoogle Scholar
  18. Le Quéré, C., Andrew, R. M., & Friedlingstein, P. (2017). Global Carbon Budget 2017. Earth System Science Data Discussion, 5, 10.  https://doi.org/10.5194/essd-2017-123.Google Scholar
  19. Li, B. G., Gasser, T., Ciais, P., Piao, S. L., Tao, S., Balkanski, Y., et al. (2016). The contribution of China’s emissions to global climate forcing. Nature, 531, 357–361.CrossRefGoogle Scholar
  20. Li, G. Q., He, Q., Shao, S., & Cao, J. H. (2018). Environmental non-governmental organizations and urban environmental governance: Evidence from China. Journal of Environmental Management, 206, 1296–1307.CrossRefGoogle Scholar
  21. Lin, B. Q., & Jia, Z. J. (2017). The impact of Emission Trading Scheme (ETS) and the choice of coverage industry in ETS: A case study in China. Applied Energy, 205, 1512–1527.CrossRefGoogle Scholar
  22. Liu, L., Zhang, B., & Bi, J. (2012). Reforming China’s multi-level environmental governance: Lessons from the 11th five-year plan. Environmental Science & Policy, 21, 106–111.CrossRefGoogle Scholar
  23. Liu, L. W., Chen, C. X., Zhao, Y. F., & Zhao, E. D. (2015). China’s carbon-emissions trading: Overview, challenges and future. Renewable and Sustainable Energy Reviews, 49, 254–266.CrossRefGoogle Scholar
  24. Liu, Y., Tan, X. J., Yu, Y., & Qi, S. Z. (2017). Assessment of impacts of Hubei Pilot emission trading schemes in China—A CGE-analysis using TermCO2 model. Applied Energy, 189, 762–769.CrossRefGoogle Scholar
  25. Lo, K. (2015). How authoritarian is the environmental governance of China? Environmental Science & Policy, 54, 152–159.CrossRefGoogle Scholar
  26. National Development and Reform Commission of China (NDRC). (2015). Enhanced actions on climate change: China’s intended nationally determined contributions 2015, Beijing, China.Google Scholar
  27. O’Neill, B. C., Oppenheimer, M., Warren, R., Hallegatte, S., Kopp, R. E., Pörtner, H. O., et al. (2017). IPCC reasons for concern regarding climate change risks. Nature Climate Change, 7, 28–37.CrossRefGoogle Scholar
  28. OECD. (2015). OECD principles of water governance. Paris: Directorate for Public Governance and Territorial Development.Google Scholar
  29. Pan, W. (2014a). German regulatory system in carbon market. Science and Technology Management Research, 1, 189–192. (in Chinese).Google Scholar
  30. Pan, W. (2014b). France regulatory system in carbon market. Journal of Environmental Protection, 21, 87–88. (in Chinese).Google Scholar
  31. Paris Agreement under the United Nations Framework Convention on Climate Change (Paris Agreement). (2015). Conference of the Parties under the United Nations Framework Convention on Climate Change, Twenty-first session, Paris, France.Google Scholar
  32. Patrinos, A. A. N., & Bradley, R. A. (2009). Energy and technology policies for managing carbon risk. Science, 325, 949–950.CrossRefGoogle Scholar
  33. Perdan, S., & Azapagic, A. (2011). Carbon trading: Current schemes and future developments. Energy Policy, 39(10), 6040–6054.CrossRefGoogle Scholar
  34. Perthuis, C., & Trotignon, R. (2014). Governance of CO2 markets: Lessons from the EU ETS. Energy Policy, 75, 100–106.CrossRefGoogle Scholar
  35. Qi, S. Z., & Chen, S. (2015). Comparative study on carbon emissions trading pilots in China. Report in 2015 Annual Review of Low-Carbon Development in China. Brookings-Tsinghua Center for Public Policy, Beijing, China.Google Scholar
  36. Ramsey, M. H. (2009). Uncertainty in the assessment of hazard, exposure and risk. Environmental Geochemistry and Health, 31, 205–217.CrossRefGoogle Scholar
  37. Ren, C., & Lo, A. Y. (2017). Emission trading and carbon market performance in Shenzhen, China. Applied Energy, 193, 414–425.CrossRefGoogle Scholar
  38. Renn, O., Klinke, A., & Van Asselt, M. (2011). Coping with complexity, uncertainty and ambiguity in risk governance: a synthesis. Ambio, 40, 231–246.CrossRefGoogle Scholar
  39. Shiroyama, H., Yarime, M., Matsuo, M., Schroeder, H., Scholz, R., & Ulrich, A. E. (2012). Governance for sustainability: knowledge integration and multi-actor dimensions in risk management. Sustainability Science, 7(S1), 45–55.CrossRefGoogle Scholar
  40. Tang, L., Wu, J. Q., Yu, L., & Bao, Q. (2015). Carbon emissions trading scheme exploration in China: A multi-agent-based model. Energy Policy, 81, 152–169.CrossRefGoogle Scholar
  41. The Central Committee of Communist Party of China (CCCPC). (2013). Decision on some major issues concerning comprehensively deepening reform. Beijing, China.Google Scholar
  42. Thurber, M. C., & Wolak, F. A. (2013). Carbon in the classroom: Lessons from a simulation of California’s electricity market under a stringent cap-and-trade system. The Electricity Journal, 26(7), 8–21.CrossRefGoogle Scholar
  43. Vicedo-Cabrera, A. M., Esplugues, A., Iñíguez, C., Estarlich, M., & Ballester, F. (2016). Health effects of the 2012 Valencia (Spain) wildfires on children in a cohort study. Environmental Geochemistry and Health, 38(3), 703–712.CrossRefGoogle Scholar
  44. Villoria-Saez, P., Tam, V. W. Y., Merino, M., Arrebola, C. V., & Wang, X. Y. (2016). Effectiveness of greenhouse-gas Emission Trading Schemes implementation: a review on legislations. Journal of Cleaner Production, 127, 49–58.CrossRefGoogle Scholar
  45. Virgone, K. M., Ramirez-Andreotta, M., Mainhagu, J., & Brusseau, M. L. (2018). Effective integrated frameworks for assessing mining sustainability. Environmental Geochemistry and Health, 40, 2635–2655.CrossRefGoogle Scholar
  46. Wang, N. N., & Chang, Y. C. (2014). The development of policy instruments in supporting low-carbon governance in China. Renewable and Sustainable Energy Reviews, 35, 126–135.CrossRefGoogle Scholar
  47. Yi, L., Lu, Y., & Li, Z. P. (2016). Research on regulatory mechanism of China pilot carbon market and comparison with international experiences. China Population, Resources and Environment, 26(12), 77–86.Google Scholar
  48. Zhang, D., Karplus, V. J., Cassisa, C., & Zhang, X. L. (2014). Emissions trading in China: Progress and prospects. Energy Policy, 75, 9–16.CrossRefGoogle Scholar
  49. Zhang, X., Qi, T. Y., Ou, X. M., & Zhang, X. L. (2017). The role of multi-region integrated emissions trading scheme: A computable general equilibrium analysis. Applied Energy, 185, 1860–1868.CrossRefGoogle Scholar
  50. Zhao, X. G., Jiang, G. W., Nie, D., & Chen, H. (2016). How to improve the market efficiency of carbon trading: A perspective of China. Renewable and Sustainable Energy Reviews, 59, 1229–1245.CrossRefGoogle Scholar
  51. Zhao, X. G., Wu, L., & Li, A. (2017). Research on the efficiency of carbon trading market in China. Renewable and Sustainable Energy Reviews, 79, 1–8.CrossRefGoogle Scholar
  52. Zhou, Y., Jiang, J. J., Ye, B., Zhang, Y. M., Yan, J. (2019). Addressing climate change through a market mechanism: a comparative study of the pilot emission trading schemes in China. Environmental Geochemistry and Health.  https://doi.org/10.1007/s10653-019-00258-x.Google Scholar

Copyright information

© Springer Nature B.V. 2019

Authors and Affiliations

  1. 1.School of Economics and ManagementHarbin Institute of Technology (Shenzhen)ShenzhenChina
  2. 2.School of Environmental Science and EngineeringSouthern University of Science and TechnologyShenzhenChina

Personalised recommendations