The Exploration of Implementation of Emissions Trading System in China

Beginning of article

1. Introduction

China's economic and social development, resources saving and ecological environment protection have become increasingly sharp, as a constraint of the bottleneck in achieving sustainable development. Exploring environmental tools for the conservation of resources, environmental protection and effective achievement of the economic and social comprehensive development, is a significant major for China right now. Theoretical analysis and international experience have shown that emissions trading system as a system of market-based incentives designed to effectively achieve these objectives, it is worth drawing on the use of China. However, it is also necessary to fully integrate the implementation of China's emissions trading system with China's economic and social reality, We need to do some research in the specific systematic construction and operate mechanism as well as make adaptive adjustments, so can we ensure to turn it into the emissions trading system which suitable for the national needs, as well as a powerful tools to prevent pollutions. This article seeks to make some explorations.

2. The Inspirations of China's Experience in the Emissions Trading Pilot Areas

In recent years, Tianjin, Jiangsu, Zhejiang, Shanghai, Shanxi, Henan, Guangxi and other provinces and municipalities of China have launched a pilot emissions trading, Jiaxing Zhejiang in November 10, 2007 established the first national emissions trading reserves center, indicating that China has taken a substantive step for implementation of the right of sewage system. We can draw some experience in the following inspiration by summing up the experience of the pilot areas.

2.1 Legal Matter

The thought of "Total Control" has not been embodied in laws, the property of environmental resources are still lacking the evidence, and the entire emission trading system is extremely fragile. In September, 2002, Xiu Zhou district of Jia Xing began the emission trading system pilot, but the outcome wasn't that good, one of the most crucial reasons is the "Total Control" doesn't have any bottom lines. For example, Shen Yue-ping, the deputy director of the Environmental Protection Agency of Jia Xing pointed out:" The rights of Sewage emission means add more administrative permit, if there is no requirement for the volume. It is not the scarcity of resources, so there is no need for transactions [1].When the total control becoming a rigid target, the environment capacity is able to become a scarce resource, the market pricing mechanism for emissions trading have the conditions. However, the thought of "total control" must be established in the law before it can authoritative. In recent years, although China has made significant achievements in environmental protection legislation and building several levels of environmental legal systems, the trading legislation in national level is still empty. Under the existing environmental protection laws and regulations, only the individual provisions for special pollutants embodied in the "total control", the main laws and regulations do not have the specific rules for "total control", which directly led to the shortage of legal rules for the property rights of environmental resources, so that the emissions trading system itself is very fragile.

2.2 Inadequate Liquidity

Emissions trading market does not have much of the attractiveness of business, which result in the limitation of trading volume and liquidity shortage. For instance, the establishment of the first national emissions trading reserve center in Jiaxing, Zhejiang, the annual emissions of COD was about 118,000 tons, sulfur dioxide emissions was 273,000 tons in 2007, but the transaction into the trading center was only hundreds of tons of the emission reductions in scale, which is still minimal; And in 2004, emissions of sulfur …