Press conference of Research Report on energy economy prediction and outlook organizer: Beijing Key Laboratory of energy economy and environmental management, energy and environmental policy research center, Beijing University of Technology Co organizer: Beijing Research Base for sustainable economic and social development, School of management and economics, Beijing University of Technology The energy economy professional committee of China Energy Research Association, energy economy and management research branch of the Research Association, specially stated that this report is one of a series of research reports completed by the research team of the energy and environmental policy research center of Beijing University of technology. If it is necessary to reprint, it must obtain the consent of the center in advance and indicate the words "reprinted from a series of research reports of the energy and environmental policy research center of Beijing University of technology". Review and Prospect of China's carbon market (2022) written by: Wang Ke, Li Siyang, Lu Mei, Wang Jiayu Wei Yiming author unit: energy and environmental policy research center of Beijing University of technology contact: Wang Ke research grant: National Natural Science Foundation of China (71871022) energy and environmental policy research center of Beijing University of technology, No. 5, Zhongguancun South Street, Haidian District, Beijing zip code: 100081 Tel.: 010-68918551 Fax: 010-68918651 e-mail: wangkebit@bit.edu.cn website: http://ceep.bit.edu.cn Center for Energy and Environmental Policy Research Beijing Institute of Technology 5 Zhongguancun South Street, Haidian District Beijing 100081, China Tel: 86-10-68918551 Fax: 86-10-68918651 E-mail: wangkebit@bit.edu.cn Website: http://ceep.bit.edu.cn1 Review and Prospect of China's carbon market (2022) carbon emission trading, as a policy tool to limit greenhouse gas emissions by market means, has been adopted by more and more countries and regions. By 2021, a total of 33 carbon emission trading systems in the world have been put into operation, covering power, industry, aviation, construction and other industries. The jurisdiction of the running carbon emission trading system accounts for about 16%, 54% and 1 / 3 of the global total greenhouse gas emissions, GDP and population respectively. In addition, a total of 22 carbon emission trading systems in the world are under planning or construction. At the end of 2017, the overall design of China's national carbon market was completed and officially launched. The construction plan of the national carbon emission trading market (power generation industry) makes it clear that the carbon market is a policy tool to control greenhouse gas emissions, and the construction of the carbon market will take the power generation industry as a breakthrough and advance steadily in stages. On July 16, 2021, the online trading of the national carbon market was officially launched. As of December 31, 2021, the cumulative trading volume of carbon emission quota (CEA) in the national carbon market has reached 179 million tons and the turnover has reached 7.684 billion yuan. Since 2013, seven pilot carbon markets have been launched in China. As of December 31, 2021, the cumulative trading volume of carbon emission quotas in the seven pilot carbon markets has reached 483 million tons, with a turnover of 8.622 billion yuan. The pilot carbon market is expected to continue to run parallel with the national carbon market for a period of time, and gradually make a smooth transition to the national carbon market. What is the novel coronavirus pneumonia epidemic situation in China? What is the impact of the new crown pneumonia epidemic on China's carbon market? What is the expectation of the future carbon market construction in China? This report will review and prospect the carbon market at home and abroad. 2 I. overview of international carbon market (2020-2021) at present, the main carbon emission trading systems worldwide include EU carbon market, US Regional Greenhouse Gas Initiative, South Korea carbon market, New Zealand carbon market, as well as China's national and pilot regional carbon markets. By 2021, there are 33 carbon emission trading systems in operation in the world. The total GDP of the region accounts for about 54% of the global total, and the population accounts for about 1 / 3 of the global population, covering about 16% of the total global greenhouse gas emissions. Various carbon emission trading systems around the world have raised more than 103 billion US dollars through auction quotas. In addition, eight carbon emission trading systems are about to start operation, and 14 carbon emission trading systems are under construction. As the earliest carbon market in the world, the carbon price of EU carbon market hit a record high in 2021. The EU carbon emissions trading system covers about 40% of the emissions from the power sector, manufacturing and aviation in the European economic area. It is the longest running carbon market in the world and the second largest carbon market in the world. 2020 is the last year of the third stage of the EU carbon market and the intensive preparation stage of the fourth stage. In 2020, the novel coronavirus pneumonia epidemic in the EU was less affected by carbon emissions. The carbon price decreased in the 3 and April periods. The highest price dropped from 29.68 US dollars per ton in January to the lowest 18.04 US dollars / ton in April. However, the price of May increased gradually after May, and it reached 33.89 US dollars / ton in July. After that, it lingered around 30 US dollars / ton, and finally reached 42.16 US dollars / ton in the May. The fourth phase of the EU carbon emissions trading system was officially launched in 2021, raising the annual total reduction factor from 1.74% in the third phase to 2.20%, and revising the benchmark value of free distribution in the manufacturing industry. In 2021, the European Commission submitted amendments to further expand the coverage of the carbon market, adjust the market stability reserve mechanism, and establish a carbon border regulation tax mechanism to prevent 3 carbon leakage. The more stringent emission reduction targets make the EU carbon market unprecedentedly active in 2021, and the carbon price continues to increase sharply, repeatedly breaking records, reaching $75 / ton by the end of September 2021, far higher than other carbon markets. The carbon price of the US Regional Greenhouse Gas Initiative carbon market is stable, the market elasticity is large, and the stability mechanism is strong. The U.S. Regional Greenhouse Gas Initiative (RGGI) originated from the climate change agreement signed by ten states in the northeast of the United States in 2005. RGGI introduced the cost control reserve mechanism (CCR) in 2015: if there is sufficient demand above the set CCR trigger price, the mechanism will immediately introduce a fixed amount of additional carbon quota in each auction; Introduce the emission control reserve mechanism (ECR) in 2021: if there is not enough demand at the trigger price higher than ECR, the mechanism will immediately reduce the carbon quota from the auction. The parallel market mechanism of ECR and CCR maintains the stability of carbon price. A market can be considered elastic if its response to demand shocks does not lead to price spikes or collapses. Covid-19 RGGI prices in the covid-19 market were relatively stable for the 2020-2021 years, and the average price was 2020 US dollars in early 2020. In March 2020, the impact of the new crown pneumonia epidemic dropped to 4.69 US dollars / ton in the early 2020. Then it quickly recovered in early April, and stabilized at around us $6 / ton in June 2020. The price has recovered to the level before the new crown pneumonia epidemic. By October 2021, it will reach about $10 / ton. On the whole, the carbon price of the US Regional Greenhouse Gas Initiative carbon market is stable with a small increase, showing the characteristics of a flexible carbon market. The carbon price of covid-19 carbon market in Korea is affected by the new crown pneumonia epidemic, and has a downward trend in 2020-2021 years. The novel coronavirus pneumonia epidemic is the most volatile year in 2020, the last year of the second phase of the Korean carbon market. The price of carbon 4 quota reached US $35.92/t at the beginning of April 2020, which began to decline sharply from May to US $16.95/t in August, then briefly rebounded to US $25.84/t in December, continued to decline from the beginning of 2021, and began to rise slowly after falling to US $11 / T in July 2021. The carbon price of covid-19 carbon market is affected by the new crown pneumonia epidemic. The 2020-2021 years of continuous fluctuations in the carbon market are decreasing. New Zealand has carried out major structural reforms in its carbon market with good results. On June 16, 2020, the adoption of the climate change response (emissions trading reform) amendment 2020 marked that New Zealand had completed a major structural reform of the carbon market, laid a legal foundation for its carbon market from 2021 to 2025, and set an emission ceiling on the carbon market Introduce carbon quota auction and develop a new carbon quota price control mechanism to support New Zealand's new goal of achieving zero net emissions by 2050. The reformed plan has officially entered into force on January 1, 2021, and the carbon quota was auctioned for the first time in March 2021. During the novel coronavirus pneumonia blockade, the carbon price of the New Zealand carbon market fell to $14.35 / ton in late March 2020, but it quickly resumed and exceeded 19.48 US dollars / ton in early June 2020, and has been on the rise since then, and has exceeded 40 US dollars / ton in October 2021. Novel coronavirus pneumonia is a New Zealand market. 2、 Operation of China's national carbon market on July 16, 2021, China's national carbon emission trading market was launched for trading, and the local pilot carbon market was parallel to the national carbon market. The trading center of the national carbon emission trading market is located in Shanghai, and the carbon quota registration system is located in Wuhan. Enterprises register accounts in Hubei and conduct transactions in Shanghai. The two places jointly assume the pillar role of the national carbon emission trading system. 5 at present, the key emission units covered by the national carbon market are power generation enterprises (including self owned power plants in other industries) that emit 26000 tons of carbon dioxide equivalent (comprehensive energy consumption is about 10000 tons of standard coal) in any year from 2013 to 2019. The power generation industry has become the first industry to be included in the national carbon market, including more than 2000 key emission units. The carbon emission of these enterprises exceeds 4.5 billion tons of carbon dioxide. The measures for the administration of Carbon Emission Trading (Trial) issued by the Ministry of ecology and environment stipulates that the national carbon market and local pilot carbon market coexist. Enterprises that have not been included in the national carbon market will continue to trade in the pilot carbon market, and key emission units included in the national carbon market will no longer participate in the local pilot carbon market. The trading product is carbon emission quota (CEA) spot, which can be traded by agreement transfer and other trading methods, including listing agreement trading and block agreement trading. It is stipulated that the transaction price of listing agreement trading shall be determined between ± 10% of the closing price of the previous trading day, and the transaction price of block agreement trading shall be determined between ± 30% of the closing price of the previous trading day. In October 2021, the Ministry of ecology and environment issued the notice on completing the clearing and payment of carbon emission quotas in the first performance cycle of the national carbon emission trading market, requiring the competent carbon market departments of all provinces to speed up the verification and clearing of quotas in the first performance cycle and strengthen the connection with the relevant systems of the national carbon market, Urge and guide the key emission units to complete the quota settlement, and ensure that 95% of the key emission units in the administrative region complete the performance before 17:00 on December 15, 2021, and all the key emission units complete the performance before 17:00 on December 31. Key emission units can use national certified voluntary emission reductions (ccers) to offset the payment of quotas, but not more than 5% of the payable quotas. 6 (I) the regional distribution of key emission units varies greatly. From January 1, 2021, the first performance cycle of the national carbon market will be officially launched. As of December 31, 2021, the first performance cycle involves 2225 key emission units in the power generation industry, and their regional distribution is shown in Figure 1. This is the first time for China's enterprises to directly implement the green emission control mechanism from the national level to the market level. Figure 1 Distribution of key emission units covered by the national carbon market. There are great differences in the distribution of key emission units among different provinces. The province with the most key emission units is Shandong Province, and the province with the least key emission units is Hainan Province. Shandong Province and Jiangsu Province cover more than 200 key emission units, much higher than other provinces, while Hainan Province covers only 7 key emission units. （2） There is still much room to improve the market activity. On July 16, 2021, the first trading day, the trading volume of CEA was 4.014 million tons, with a total turnover of more than 210 million yuan. As of December 31, 2021, China's national carbon market has operated smoothly, with a cumulative trading volume of about 179 million tons and a total turnover of about 7.684 billion yuan. The total quota of the national carbon market is about 4.5 billion tons. According to the current trading volume, the turnover rate of the national carbon emission trading market is about 3%. The EU carbon market is currently the most active carbon market in the world. The turnover rate of the EU carbon market has increased from 4.09% in the initial stage to 417% at present. Compared with the EU carbon market, China's national carbon market is still in the early stage of development, and there is still much room to improve the market activity. （3） The market trading volume surged near the end of the first performance cycle. Figure 2 shows the fluctuation of the daily trading volume of the national carbon market. There were few transactions in the national carbon market at the initial stage, but the daily trading volume began to rise from October 2021 and increased sharply in November and December 2021. The notice on completing the clearing and payment of carbon emission quotas in the first performance cycle of the national carbon emission trading market requires 95% of the key emission units in the administrative region to complete the performance before 17:00 on December 15, 2021, and all the key emission units to complete the performance before 17:00 on December 31. The national carbon market has less trading volume in the initial stage, but the carbon market is unprecedentedly active near the end of the performance cycle. The annual maximum daily trading volume of nearly 20 million tons appears in December, and the daily trading volume in December is mostly between 5-10 million tons, much higher than that in other months. Overall, the market maturity of the national carbon market needs to be further improved. Figure 2 fluctuation of daily trading volume in the national carbon market figure 3 shows the change trend of daily average trading price in the national carbon market. From July to August 2021, the daily average trading price in the national carbon market fluctuated between 50-60 yuan / ton. From August, the volatility of daily average trading price weakened and gradually decreased, from September to early December, The average daily transaction price is basically stable at about 40 yuan / ton. However, from the middle of December, the average daily transaction price of the national carbon market began to rise, and it had risen to 60 yuan / ton by the end of December. On the whole, the average daily transaction price in the national carbon market fluctuates in the range of 40-60 yuan / ton, which remains basically stable. Figure 3 change trend of daily average transaction price in the national carbon market (V) block agreement trading is the main trading mode at present. The transfer of carbon emission rights agreement will include listing agreement trading and block agreement trading, of which less than 100000 tons are traded by listing agreement and more than 100000 tons are traded by block agreement. Figure 4 shows the proportion of monthly total trading volume of block agreements and listing agreements in the national carbon market. nine