Shanghai Starts Carbon Trading Permit Program
As shanghai started its first carbon permits trading at 27 yuan yesterday as part of the plans of launching such trading program as China bids to cut the fast growing greenhouse gases emissions. There are three trading program for a total of 9,500 permits were made for compliance which is also known as the Shanghai Emissions Allowances were sold in the first half of the hour after the market opened. The third market will open in Beijing on Thursday.
China promised to reduce greenhouse gases emission per unit of gross domestic product down to 40 or 45 percent by 2020. Vice director for the Shanghai Environment and Energy Exchange said that the State owned power company Huaneng is one of the companies that were involved in the deals but no further details were given. Opening prices were matched on the first trades that were pushed through after the Shenzhen emission market opened in June that saw prices increase to 60 yuan.
Based on the Shanghai program it will be capping carbon dioxide emissions from 190 big users located in the city. Participants will be getting free permits from the government that wil cover some of their expected emissions. When they exceed these levels they must purchase permits in the market from these companies that have a surplus in offset projects.