As many U.S. states start to think about ways to reduce greenhouse
gas emissions under the proposed Clean Power Plan, it’s eye-opening to
see how Chinese provinces are taking many of the same first steps. I
recently joined state officials from Arizona and Michigan and a
Georgetown University professor on a study tour of China’s climate
policy and low-carbon technology use at the provincial level.
In each
city we visited -- Beijing, Shanghai, Chengdu in Sichuan province, and
Changsha in Hunan province -- our meetings with government officials,
academics, and nongovernmental organizations had a common theme:
Environmental issues are a serious challenge for China and greenhouse
gases should be addressed along with other types of pollution. It
was very encouraging to hear national, provincial, and municipal leaders
all agree that something has to be done to reduce China’s emissions.
But they also agreed the country faces significant challenges in
reaching its goal of peaking emissions no later than 2030.
As in California and nine Northeast states,
market-based mechanisms are being used to reduce greenhouse gas
emissions in China. The central government’s 12th Five-Year Plan called
for emission trading programs. Since 2013, seven carbon trading pilots
have been established, while other jurisdictions are creating voluntary
programs or scaling up their efforts in expectation of the launch of a
nationwide emissions-reduction program in 2016.
Each pilot has
different features and levels of ambition, but together they cover
jurisdictions representing 25 percent of China's GDP and make up the
second largest emissions trading system in the world after Europe's. Our
study group got to see the diversity of approaches up close.
In
Beijing and Shanghai, two of the wealthiest cities in China, carbon
markets have been active since 2013. Unlike U.S. goals of reducing
emissions in absolute terms, their pilots are designed to reduce
emissions intensity. Beijing's program covers 40 percent of emissions in
the city, while Shanghai's covers 57 percent. Both cities allow
offsets, but Beijing requires half of all offsets be located in the city
itself.
Sichuan and Hunan provinces are not part of the pilot
programs. However, these provinces are preparing for the start of
national carbon markets in 2016. Sichuan’s water rights exchange is
providing some relevant experience for the establishment of a carbon
market. Sichuan also is trying other paths to reduce greenhouse gas
emissions, including incentives for alternative fuel vehicles and
increased use of hydroelectric power. Additionally, the province sits
atop the Sichuan Basin natural gas deposit, and provincial leaders hope
hydraulic fracturing will eventually produce enough natural gas for
power generation and transportation. We also visited Sichuan University,
where researchers are experimenting on ways to use carbon dioxide to
produce electricity.
In Hunan, experts told us of the rush to
identify emission sources and improve the frameworks for emission
reporting. In 2014, 800 enterprises reported emissions from sources that
emit more than 13,000 tons of carbon dioxide per year. Experts from the
Hunan Innovative Low-Carbon Center, a government-approved non-profit,
verified the reported numbers and found that larger businesses were
generally accurate, but smaller enterprises did not yet have the energy
management systems to provide accurate statistics.
As the pilot
and reporting programs evolve into a permanent carbon market in China in
2016, the provinces will have to make sure they run properly and with
accurate reporting systems. The same holds true for U.S. states also
making the leap to carbon markets, which made the lessons we learned on
this study tour so valuable.
http://www.theenergycollective.com/michaeltubman/2247832/china-s-provinces-learn-how-reduce-emissions-trading