The scheme’s expansion to include the steel, cement, and aluminum smelting industries increases the program’s coverage to 60% of China’s total greenhouse gas emissions.
By Paul A. Davies, JP Brisson, Michael Green, and Qingyi Pan
On March 26, 2025, China’s Ministry of Ecology and Environment (the MEE) published the “Work Plan for the National Carbon Emissions Trading Market Covering the Steel, Cement, and Aluminum Smelting Industries” (the Work Plan).1 The Work Plan expands the scope of
Market participants can expect the initiative’s proposals to offer guidance on setting targets for emissions reduction and decarbonisation.
By Paul A. Davies, Michael D. Green, and James Bee
On 12 January 2021, the Science Based Targets initiative (SBTi) published its “SBTi Climate Action in 2022” proposals (the 2022 Proposals), highlighting the areas that the organisation is seeking to work on and develop throughout 2022. The SBTi is a partnership between the CDP (formerly the Carbon Disclosure Project), the UN Global Compact, the World Resources Institute, and the World Wide Fund for Nature, which seeks to mobilise the private sector to reduce its carbon footprint by defining, promoting, and verifying best practices in corporate emissions reduction strategies in line with the goal of the Paris Agreement to limit global temperature increases to 1.5°C above pre-industrial times.
The SBTi continued to grow rapidly throughout 2021, with more and more companies setting SBTi-aligned or verified targets and stakeholders increasingly expecting corporate climate commitments and targets to be aligned with SBTi. As a result, the 2022 Proposals, by identifying the key areas which SBTi is seeking to develop this year, may considerably impact a large number of companies looking to set climate targets.
The president’s executive order aims to use the US government’s procurement power to achieve “carbon pollution-free electricity” by 2030 and net zero emissions by 2050.
By Jennifer Roy and Julie Miles
On December 8, 2021, President Biden issued an Executive Order on Catalyzing Clean Energy Industries and Jobs Through Federal Sustainability (EO), which aims to set the federal government — the largest purchaser in the country with an annual purchasing power of $650 billion — on a path to net zero emissions by 2050. The EO establishes the following policies as part of a whole-of-government strategy.
A multistate cap-and-invest program to reduce carbon emissions from the transportation sector is dead after several participating states pulled out.
By Jean-Philippe Brisson, Joshua T. Bledsoe, Benjamin Einhouse, and Brian McCall
Less than one year ago, the governors of Massachusetts, Rhode Island, and Connecticut, as well as the mayor of the District of Columbia, announced that their respective jurisdictions would establish the Transportation & Climate Initiative Program (TCI-P) and released a memorandum of understanding (MOU) describing the agreed-upon principles for adoption and implementation of a regional program aimed at reducing carbon emissions from the transportation sector. But in the past two weeks, three of the four jurisdictions that signed the MOU have pulled out, effectively terminating the TCI-P.
The start of trading represents a significant opportunity for businesses able to achieve meaningful reductions.
By Paul A. Davies and R. Andrew Westgate
Nearly four years after China’s national emissions trading scheme (ETS) was announced in late 2017, trading of emissions quotas officially commenced on July 16. The start of trading represents a significant step in China’s adoption of market-based mechanisms for addressing climate change, while also signifying a major opportunity for businesses able to achieve meaningful reductions.
More than 4.1 million tonnes of Chinese Carbon Emission Allowances (CEAs) traded on the first day at a price of RMB52.78 (or US$7.42) per tonne — an amount that was in line with analysts’ expectations for launch. Although this price is significantly below the prices of allowances in the EU ETS (€52.89 per tonne on July 16) or California (US$18.80 per tonne at the May 2021 auction), it is close to the allowance price in the Regional Greenhouse Gas Initiative (RGGI) — a cap-and-trade program covering 11 states on the east coast of the United States (US$7.97 per tonne at the auction held on June 2, 2021). Like China’s ETS in its initial phase, the RGGI covers only power plants. Since the launch, prices have largely held steady, although volume fell significantly after the initial flurry of activity.
The agency’s rulemaking to implement the AIM Act will offer stakeholders opportunities to shape a new market-based mechanism to reduce HFCs.
By Jean-Philippe Brisson, Stacey VanBelleghem, and Zaheer Tajani
Tucked inside the US$900 billion COVID-19 relief package signed into law on December 27, 2020, is a regulatory opportunity for the climate-focused Biden Administration: the American Innovation and Manufacturing Act of 2020 (the AIM Act). The AIM Act requires the US Environmental Protection Agency (EPA) to develop an allowance trading system to aggressively phase down the production and consumption of certain chemical refrigerants, called hydrofluorocarbons (HFCs), throughout the United States.
New trade arrangement incentivizes power operators to be more energy-efficient.
By Paul A. Davies, R. Andrew Westgate, Qingyi Pan, and Jacqueline J. Yap
On January 1, 2021, the long-awaited China Emissions Trading Scheme (ETS) commenced operation, with 2,225 coal-fired power plants participating. Under this new ETS, China’s power operators will have to buy emissions permits if their coal plant exceeds carbon intensity benchmarks, giving power operators an incentive to improve efficiency. Since 2011, China has developed pilot emissions trading platforms in nine cities and provinces, paving the way for a national trading scheme that was first announced in 2017, along with an emissions trading market development plan for the power generation sector. After almost four years of development, the first annual compliance cycle officially began on January 1. China’s Ministry of Ecology and Environment (MEE) has published several policy documents on the national ETS that establish regulatory authority and specify general rules for key areas of market operation and design, including the Carbon Emissions Rights Trading Regulations (Trial), which was published in November 2020.
The newly published Energy White Paper establishes a domestic trading scheme and sets out plans to clean out energy.
By Paul A. Davies and Michael D. Green
On 14 December 2020, the UK Government published its Energy White Paper (the Paper). The Paper builds on previous green economy plans, setting them “in a long-term strategic vision, […] consistent with net zero emissions by 2050”.
The Paper further details ambitions unveiled by the Prime Minister in mid-November, in his Ten Point Plan. Moreover, the Paper sheds more light on previously established initiatives, such as the UK Emissions Trading Scheme, previously set into law through the Greenhouse Gas Emissions Trading Scheme Order 2020.
President Xi Jinping promises to reduce carbon emissions in speech before the UN General Assembly.
By Paul A. Davies, Michael D. Green, R. Andrew Westgate, and Jacqueline J. Yap
On 22 September 2020, during a speech before the UN General Assembly, President Xi Jinping announced China’s commitment to become carbon neutral by 2060 and reaffirmed China’s commitment under the Paris Agreement to peak its carbon emissions by 2030. China is the world’s largest greenhouse gas (GHG) polluter and emitted approximately 10 billion tons of carbon dioxide in 2018, according to the Global Carbon Project. Given this, China’s commitment to become carbon neutral by 2060 would significantly reduce global GHG emissions and set the stage for China’s development of a green economy.
The UK citizens’ assembly identifies overarching principles and makes specific recommendations for achieving the environmental goal.
By Paul A. Davies and Michael D. Green
Background
The Climate Assembly UK has published its report on how the UK can achieve its statutory target for net zero carbon emissions by 2050. The report, which was released on 10 September 2020, followed more than a month of weekend meetings (some of which took place remotely due to the pandemic). Participants underwent a three-stage process of learning, discussion, and decision-making.
Comprising 108 members of the public, the citizens’ assembly was commissioned in June 2019 by six Select Committees of the House of Commons, including the Environmental Audit and Business Energy and Industrial Strategy. The House of Commons sponsored the initiative, with two philanthropic organisations providing additional funding and not-for-profit organisations organising the assembly