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The national carbon market had a turnover of 210 million on the first day, and there is still room for price increases

Echemi 2021-07-20

The National Carbon Emissions Trading Market (hereinafter referred to as the "National Carbon Market") recently held a launch ceremony in Beijing, Shanghai, and Wuhan at the same time, and immediately opened the first batch of transactions after it went online. So far, the national carbon emission trading system that has received much attention has been officially launched. PetroChina, Sinopec, Huaneng Group, Huadian Group, Shenergy Group and other companies have participated in the first day of trading in the national carbon market. According to industry insiders, the official opening of the national carbon market marks a new stage in my country's market-based carbon emission reduction. This is another major milestone in China's response to climate change.


The first day of launching the national carbon market ushered in a good start. According to data from the Shanghai Environment and Energy Exchange (hereinafter referred to as "Shanghai Central Exchange"), the opening price of carbon allowances is 48 yuan/ton. At 9:30, the first national carbon transaction has been successfully matched, with a price of 52.78 yuan/ton, a total of 160,000 tons of transactions and a transaction volume of 7.9 million yuan. As of the close of the day, the latest price of carbon allowances was 51.23 yuan/ton, an increase of 6.73%, and the average price was 51.23 yuan/ton. The highest price of the day was 52.80 yuan/ton, and the lowest price was 48 yuan/ton. The total transaction volume is 4.1040 million tons, and the total transaction volume is 210 million yuan.


The relevant person in charge of the Shanghai Stock Exchange stated that according to relevant trading rules, the average transaction price throughout the day is the closing price of the day. As a result, the closing price of carbon emission allowances on the first trading day of the national carbon market was also reported at 51.23 yuan/ton. On the whole, transactions on the first trading day of the national carbon market were stable and orderly and in line with expectations, and the market participants were more enthusiastic about investment transactions.


Zhao Yingmin, deputy minister of the Ministry of Ecology and Environment, pointed out that domestic and foreign practices have shown that the carbon market is a policy tool to achieve specific emission reduction targets at a lower cost. Compared with traditional administrative management methods, it can consolidate the responsibility of greenhouse gas control and emission to enterprises. It can also provide corresponding economic incentives for carbon emission reduction, reduce the emission reduction costs of the whole society, and drive green technological innovation and industrial investment, which provides an effective tool for dealing with the relationship between economic development and carbon emission reduction.


The "14th Five-Year Plan" period is a critical period and window period for carbon peaking. Building a mature and complete carbon market is an important path for achieving carbon peaking and carbon neutrality. As the power generation industry is included in the carbon market to promote green and low-carbon development, high-emission industries such as petrochemicals, chemicals, building materials, steel, non-ferrous metals, papermaking, and aviation may all be included in the national carbon trading market.


Looking forward to the follow-up carbon price trend, the industry generally expects that the follow-up price may have greater room for increase. The "China Carbon Price Survey Report 2020" prepared by the China Carbon Forum and other institutions predicts that the national carbon emissions trading price is about 49 yuan/ton at the beginning of its establishment, and the carbon price is expected to reach 93 yuan/ton by 2030, In the middle of the century, more than 167 yuan/ton.


Guojin Securities Research Report pointed out that because carbon prices are affected by many factors, a feasible carbon price prediction method is to calculate the ratio of China's carbon trading market from the ratio of the EU's carbon trading market to the total GDP when the EU's carbon peaks. As the overall economic development of the 28 EU countries is better than that of China, China's carbon trading value as a proportion of GDP is at most comparable to the EU market. According to its calculations, the carbon price in China's carbon market in 2030 will be around RMB 80-120 per ton. This result is close to the US$13/ton carbon price in the national carbon market estimated by another research team, Zhang Xiliang's team at Tsinghua University in 2030.

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