By Shen Chunshen
The 2nd pilot city in China that launches carbon emission trading, Shanghai opened its carbon emission trading last November in Shanghai Environment Energy Exchange. By the end of this November, 191 pilot enterprises all completed their payment for 2013 carbon ration, reaching a 100% performance rate. By now, Shanghai became the 1st pilot city that fulfilled the performance of carbon trading.
Carbon trading is to trade carbon emission like other commodities. The government would manage the carbon emission ration and assign annual emission contracts to participating enterprises. In the meantime, emitting enterprises could buy or sell extra rations through this market.
Since 2008, Hongkou has been focusing on developing a low-carbon industry development service platform with Huayuanfang as the center. Through continuous adjustment, planning and construction, new industries such as low carbon finance and low carbon professional service begun to take shape. The influence and radiation of Huayuanfang low carbon industry are increasing and Huayuanfang started to gain a more important position in Shanghai’s low carbon economy layout thanks to the operation of such functional institutions as Shanghai Environment Energy Exchange and Shanghai Energy Efficiency Center.
According to Hongkou Commission of Commerce, Hongkou where Shanghai Environment Energy Exchange, the appointed carbon emission trading platform in Shanghai, settled, is not only the pilot to exlpore Shanghai carbon emission trading in the early stage, but also the place where Shanghai would promote the development of low carbon industry.
China is preparing for a national carbon trading market in 2016, which means that these separate markets would integrate into a unified system. A unified market system is required for a national carbon trading market, especially for the mechanism of forming carbon trading price, said Bin Hui, Associate General Manager of Shanghai Environment Energy Exchange.
Bin Hui said that the mechanism, legal system, rules and platform construction for carbon emission trading in Shanghai have been completed within 1 year’s pilot. Trading has been listed gradually since the end of last year, and the general situation is stable. He also revealed that central government is now regarding the carbon emission trading right the key task of central economic system form in this year, and Shanghai Environment Energy Exchange, the local center of carbon emission trading, would offer supports to National Development and Reform Commission to facilitate the releasing of unified trading rules according to the requirements of central reform team.
In the meantime, there was another piece of good news. Shanghai Environment Energy Exchange signed a carbon financial strategic cooperation agreement with Bank of Shanghai and reached China’s 1st CCER (Chinese Certified Emission Reduction) Guarantee Loan Contract with Shanghai Bao Carbon New Energy Environmental Protection Science and Technology Limited Company. Through pledging the CCER released by National Development and Reform Commission, Bank of Shanghai would provide Shanghai Bao Carbon RMB 5 million loan, which would decrease enterprises’ repayment pressure and take advantage of carbon tracing’s connecting role between financial capital and real economy.
According to introduction, CCER is the new to China’s carbon trading. It is not only an important factor to supplement and activate this market, but also bears great significance to the establishment of a unified national carbon trading market and a complete carbon asset pricing mechanism.
In Huayuanfang energy-saving and environmental protection industry park, there are already over 20 institutions gathered here, including Shanghai Environment Energy Exchange, Shanghai Energy Efficiency Center, Shanghai Office of Contract Energy Management, China Quality Certification Center (Shanghai Branch), WWF and so on. All these functional institutions are responsible for such work as comprehensive trading, energy-saving certification, information release, standard research and examination, proving value and price discovery and various professional services for the industry. Therefore, Hongkou also becomes the district with most energy-saving enterprise and complete functions in Shanghai and its radiation effect is also increasing.
According to Hongkou Commission of Commerce, they would enhance Huayuanfang-based low-carbon industry cluster’s development and take advantage of the diversity and cluster of low-carbon industry resources brought by carbon emission trading.