China publishes revised draft of provisional regulations on carbon trading

China’s Ministry of Ecology and Environment on March 30, 2021 published the “Provisional Regulations on Carbon Trading Management (revised draft)”. This draft is open for public comments until April 30, 2021. A draft for comments of the regulations was previously published at the end of March 2019. The changes added to the revised draft are shown below.

Purposes of the regulations

The purposes of the regulations are to reach the peak of carbon emissions and to achieve carbon neutrality (Article 1).

Note: China aims to reach the peak of emissions by 2030 and achieve carbon neutrality by 2060.

Total emission control

Total carbon allowances will be defined and an allocation plan developed in accordance with the central government’s total greenhouse gas emission control and phased targets (Article 8).

Creation of a carbon trading fund

The government will set up a carbon trading fund. Payments from key emitters for paid allowances will be put into the fund and it will be used for the establishment of the carbon trading market and key greenhouse gas reduction projects (Article 21).

Reporting requirements for emitters

Key emitters are responsible for genuine, complete and accurate reporting on their greenhouse gas emissions. They must submit the report by March 31 every year and keep the original records and logbooks of the data for at least five years (Article 9).

Disclosure requirement

Key emitters must publish their greenhouse gas emission records promptly (Article 19).

Abolition of local carbon markets

After the regulations takes effect, no new local carbon market will be created. Local carbon markets established before the enforcement of the regulations will be incorporated into the national carbon market in phases (Article 32).

The full text of the revised draft (in simplified Chinese) is available at

http://www.mee.gov.cn/xxgk2018/xxgk/xxgk06/202103/t20210330_826642.html.