Design and impact assessment of policies to overcome oversupply in China's national carbon market.

Autor: Ji CJ; Institute of Carbon Neutrality, ShanghaiTech University, Shanghai, 201210, China; Center for Energy and Environmental Policy Research, Beijing Institute of Technology, Beijing, 100081, China. Electronic address: jichj@shanghaitech.edu.cn., Wang X; Institute of Carbon Neutrality, ShanghaiTech University, Shanghai, 201210, China. Electronic address: wangxd2@shanghaitech.edu.cn., Wang XY; Environmental Development Center of the Ministry of Ecology and Environment, Beijing, 100029, China., Tang BJ; Center for Energy and Environmental Policy Research, Beijing Institute of Technology, Beijing, 100081, China; School of Management and Economics, Beijing Institute of Technology, Beijing, 100081, China; Beijing Key Lab of Energy Economics and Environmental Management, Beijing, 100081, China. Electronic address: tbj@bit.edu.cn.
Jazyk: angličtina
Zdroj: Journal of environmental management [J Environ Manage] 2024 Mar; Vol. 354, pp. 120388. Date of Electronic Publication: 2024 Feb 20.
DOI: 10.1016/j.jenvman.2024.120388
Abstrakt: China has adopted a national carbon emissions trading market to promote emission reductions, but until now, overallocation of allowances suffer low carbon prices and thus to unfulfilled emission reduction goals. We report a general equilibrium modeling that indicates the flexible compliance and price adjustment mechanism of the carbon market, along with explores the solution to the oversupply of allowances in the China's national carbon market. We find that, under the current policy, the initial loose allowance allocation decreases the overall carbon price, and simultaneously the total amount of banked carbon allowances reaches 4.880 billion tons in 2030, resulting in the level of carbon price cannot achieve NDC (Nationally Determined Contribution) targets. However, by introducing carbon market price adjustment schemes, we observe that the cumulative amount of allowances can effectively reduce, enabling the carbon price rising. Importantly, the amount of the supply of allowances decreases most under the benchmark decrease scenario, which increases the emission reduction pressure of the enterprises from the beginning, leading to the largest economic losses, the price-based adjustment mechanism raises the carbon price to expected level at the minimize economic losses, and the quantity-based adjustment mechanism is more sensitive to policy parameters compared to the price -based adjustment mechanism. These findings offer a promising avenue for selecting cost-effective price adjustment mechanism to improve price mechanism design for national carbon markets.
Competing Interests: Declaration of competing interest The authors declare that they have no known competing financial interests or personal relationships that could have appeared to influence the work reported in this paper. The policy scenario refers to the flexible mechanism design of the existing China's national ETS, as well as potential adjustment polices to overcome oversupply in the mainstream ETSs. First, the national ETS policy scenario (Current Policy, CP) follows the existing national carbon market policies and only includes the flexible compliance. Second, benchmark value decline scenario (Benchmark Decline, BD) reflects both cap adjustment and flexible compliance. Third quantity-based supply-side adjustment scenario (Quantity-based adjustment, QA) reflects both flexible compliance and price adjustment mechanism, where adjusts carbon prices via flexibly adjusting allowances supply based on the allowance quantity. Fourth, the price-based supply-side adjustment scenario (Price-based adjustment, PA) reflects both flexible compliance and price adjustment mechanism, where adjusts carbon prices via flexibly adjusting allowances supply based on carbon price. The main parameters in the model are shown in Table 2.
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Databáze: MEDLINE
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