Provincial level authorities will be able to set carbon emissions caps for the first time, and shall be charged with verifying greenhouse gas emissions reports.
China’s MEE (Ministry of Ecology and Environment) has issued new rules governing carbon emission rights trading in the country.
China launched a pilot carbon trading market in seven provinces and cities, including Beijing. The new rules, issued following a consultation in November, pave the way for the construction of a nationwide carbon emissions rights trading market, which will help China meet its pledge to become carbon neutral by 2060.
Under the rules, the MEE will set up the national carbon emission rights market, along with a registration agency that records the holding, modification, payment, and cancellation of carbon emission allowances and provides settlement services.
A national carbon emission rights registration agency will be responsible for organising the centralised and unified trading of national carbon emission rights, the rules say.
Provincial level authorities will be able to set carbon emissions caps for the first time, and shall be charged with verifying greenhouse gas emissions reports, including through inspections.
Institutions authorised to trade in the carbon emission rights market will be required to establish risk management mechanisms and information disclosure systems, and prohibited from using the market to facilitate illegal gains or fraud, which will be subject to rectification orders and penalties.
The rules specify maximum penalties of CNY 30,000 for false reporting, a failure to submit emissions reports, or concealing information in such a report.
Authorities may also reduce emission allowances if firms fail to rectify such failures within an imposed time limit. Criminal matters will be referred for prosecution.
The new rules, available here, take effect from 1 February 2021.