#  China's National Carbon-Pricing System: Challenges and Opportunities  

 



 A research workshop co-hosted by:

 Tsinghua University’s Institute of Energy, Environment and Economy and the

 Harvard Project on Climate Agreements

 With the Support of the Harvard Global Institute

 Climate change poses a severe threat to the global economy, human society, and local and regional communities and ecosystems. China is the largest emitter of the greenhouse gases that cause climate change but is implementing a number of policies to reduce its emissions. The policy with the greatest impact, over time, may be China’s national carbon-pricing system.

 This research workshop, led by researchers at Tsinghua and Harvard Universities, will address remaining challenges to designing and implementing China’s national carbon-pricing system and thereby, it is hoped, contribute to its effectiveness. Participants – experts on carbon pricing from China, the United States, Europe, and Australia – will make brief presentations to facilitate discussion on specific design issues and on longer-term challenges and opportunities, such as policy interaction (e.g., with ongoing market/policy reform of the power sector) and expansion of coverage (integration of pilots; extension to other sectors; evolution toward absolute, economy-wide cap; evolution toward upstream regulation).

 This workshop is part of an ongoing collaboration between Tsinghua University’s Institute of Energy, Environment and Economy, directed by Professor Zhang Xiliang, and the Harvard Project on Climate Agreements, Directed by Professor Robert Stavins. Most recently, the two programs co-organized a workshop on subnational climate change policy in China (July 2019), on the basis of which the Harvard Project released a [volume of briefs](https://www.belfercenter.org/publication/subnational-climate-change-policy-china) on this topic.

 The organizers are grateful to the [Harvard Global Institute](https://globalinstitute.harvard.edu/) for support of the initiative of which this workshop is a part. The Institute supports research initiatives that deepen Harvard University’s international engagement and promote University-wide scholarship to address pressing global challenges such as climate change, migration, and transnational relations.

##  [Instructions for Using Zoom Simultaneous Interpretation](/file_url/1111)

##  [Agenda and Participant List](/file_url/1132)

##  [Particpant Bios](/file_url/1116)

##  Presentations:

 **Day 1**

 ZHANG Xiliang: ["An Update on China's National Carbon Market Development"](/file_url/1134)

 ZHANG Jingjie, ["Introduction on Power Sector Engagement in China's ETS and Allowance Allocation"](/file_url/1135)

 Billy PIZER: ["Equity versus cost-effectiveness in the Chinese ETS"](/file_url/1119), response to ZHANG Jingjie.

 ZHANG Lixin, ["China MRV System and Enforcement"](/file_url/1136)

 **Day 2**

 DUAN Maosheng, ["Overview of longer-term challenges to – and opportunities for – China's national ETS"](/file_url/1114)

 Robert STAVINS, ["Policy Interactions within a Carbon-Pricing System"](/file_url/1124)

 QI Shaozhou, ["Response to Policy Interactions](/file_url/1120)," response to Robert STAVINS.

 WU Libo, ["Interactions Between ETS And Power Sector,"](/file_url/1123) response to Robert STAVINS

 Lawrence GOULDER, ["Potential Reforms and Extensions to the Trading Program"](/file_url/1125)

 ZENG Xuelan, ["Prospects on Guangdong ETS](/file_url/1121)," response to Lawrence GOULDER.

##  Background Reading:

 Following are selected papers on China's national system that may be useful as background to the workshop. Click on the body of the reference for a local copy of the paper:

- [Stavins, Robert. “The Future of U.S. Carbon-Pricing Policy.” National Bureau of Economic Research Working Paper 25912. May 2019](https://www.belfercenter.org/publication/future-us-carbon-pricing-policy).

- [Goulder, Lawrence, Xianling Long, Jieyi Lu, and Richard Morgenstern. “China’s Unconventional Nationwide CO2 Emissions Trading System: Cost-Effectiveness and Distributional Impacts,” August 2020.](/file_url/1089)

- [Da Zhang, Qin Zhang, Shaozhou Qi, Jinpeng Huang, Valerie J. Karplus and Xiliang Zhang. (2019). “Integrity of firm emissions reporting in China’s early carbon markets.” Nature Climate Change, 9, 164-169. ](/file_url/1095)
- [Goulder, Lawrence H., and Richard D. Morgenstern. “China’s Rate-Based Approach to Reducing CO2 Emissions: Attractions, Limitations, and Alternatives.” AEA Papers and Proceedings 108 (2018): 458–62](/file_url/1091). [https://doi.org/10.1257/pandp.20181028](https://urldefense.proofpoint.com/v2/url?u=https-3A__doi.org_10.1257_pandp.20181028&d=DwMGaQ&c=WO-RGvefibhHBZq3fL85hQ&r=ktEXZv41bteGbkEwTaOxo4vgAuftwL9XN2h9YzHFzkw&m=A6CIUHuWFBngLqDoS_S29SEz5OeAcSf5SJ5gfyGT2xc&s=8El3-pRMjqFueQZ8J5lxwwUMPM7DxAzKA9wnVkWhhSM&e=).
- [Valerie J. Karplus and Xiliang Zhang. (2018). “Incentivizing firm compliance with China’s national emissions trading system.” Economics of Energy & Environmental Policy, 6(2), 73-86.](/file_url/1096)
- [Mingwei Li, Da Zhang, Chiao-Ting Li, Kathleen M. Mulvaney, Noelle E. Selin and Valerie J. Karplus. (2018). “Air Quality Co-benefits of Carbon Pricing in China.” Nature Climate Change, 8(5), 398-403.](/file_url/1097)
- [Pizer, William A., and Xiliang Zhang. “China’s New National Carbon Market.” AEA Papers and Proceedings 108 (2018): 463–67. https://doi.org/10.1257/pandp.20181029.](/file_url/1094)
- [Duan, Maosheng, and Li Zhou. “Key Issues in Designing China’s National Carbon Emissions Trading System.” Economics of Energy & Environmental Policy 6, no. 2 (April 1, 2017).](/file_url/1092) [https://doi.org/10.5547/2160-5890.6.2.mdua](https://urldefense.proofpoint.com/v2/url?u=https-3A__doi.org_10.5547_2160-2D5890.6.2.mdua&d=DwMGaQ&c=WO-RGvefibhHBZq3fL85hQ&r=ktEXZv41bteGbkEwTaOxo4vgAuftwL9XN2h9YzHFzkw&m=A6CIUHuWFBngLqDoS_S29SEz5OeAcSf5SJ5gfyGT2xc&s=F6AlpgR3FnmYbAmFQ_KqWs-xJ34-xNDnv4-7rXYi3A4&e=).
- [Da Zhang, Marco Springmann, and Valerie J. Karplus (2015). “Equity and Emissions Trading in China.” Climatic Change, 134, 131-146.](/file_url/1098)