China’s Emerging Carbon Offset Market
By Dr. Ralph Westermann and Gaiai Guo
At the UN Climate Change Summit held in New York on September 23, 2014, China’s vice premier Zhang Gaoli claimed that China, the world’s biggest greenhouse gas (GHG) emitter, will take firm action on climate change and announced that it will make every effort to reach its carbon dioxide emissions peak as early as possible. Only shortly thereafter, on November 12 in Beijing, US president Barack Obama and his Chinese counterpart, Xi Jinping, unexpectedly unveiled a secretly negotiated agreement between the United States and China to lower GHG output. Under the deal, China committed for the first time to cap its carbon emissions by 2030. In addition, China plans to increase its use of renewable energy to 20 percent within that time frame. In return, the United States agreed to double the pace of the cuts in its emissions, reducing them to between 26 and 28 percent below 2005 levels by 2025.
Although these commitments still fall short of what is needed to fight global warming, and while it also remains unclear whether the two countries are able to fulfil their new GHG reduction promises, this historic bilateral agreement has the potential to change the rules of the game for UN climate change negotiations. And it might unblock the road for a legally binding global agreement on climate protection in Paris at the end of 2015, and the establishment of a global carbon market.
This article has been published by the Wuppertal Institute for Climate, Environment and Energy in Issue 4, November/December 2014, of the Carbon Mechanisms Review, pp. 26-33. To obtain the full text (English only), please click on the download link below.
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|Publication Date||November 28, 2014|
|Partner||Dr. Ralph Westermann|