China’s trade war with the US, weak consumer demand and the outbreak of the pandemic have largely affected the country’s economy and roll-out of the carbon market
June 04, 2020. By News Bureau
The COVID-19 outbreak causing severe economic disruption in China is expected to derail the efforts that had been put in all these years to establish the country’s national emissions trading market by the end of 2020, says GlobalData.
Earlier in the year, China had ordered firms from eight industrial sectors, namely, oil, chemicals, construction materials, steel, nonferrous metals, papermaking, electric power and shipping to submit their carbon emission data before the end of March 2020, in preparation for the ETS launch but the pandemic prevented participating industries to begin calculating and reporting emissions data.
China’s trade war with the US, weak consumer demand and the outbreak of the pandemic have largely affected the country’s economy and roll-out of the carbon market.
Somik Das, Senior Power Analyst at GlobalData, comments: “The pandemic has prevented officials from conducting the verification process of the companies reporting the emissions data. In April, the province of Guangdong had pushed back its annual compliance deadline for companies by two months in its emissions trading scheme, giving companies more time to finalize their 2019 data verification. Hence, further delays would only push back the establishment of the market and raise doubts over the possibility of meeting the deadline.”
The national carbon market when implemented has the potential to become the largest in the world and drive down the emissions in China.
Das concludes: “Institutional delays and the outbreak of COVID-19 is expected to give rise to hurdles that would affect the pace and timing of the implementation of the national market. The government seems to be taking a softer stance on environmental accountability to lower the cost burden on business and spur economic activity, which could see a delay in the integration of businesses into the carbon market.”
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