Project Background

The Sino-German project “Capacity Building for the Establishment of Emissions Trading Schemes (ETS) in China” is jointly implemented by GIZ and the Ministry of Ecology and Environment (MEE) of the People’s Republic of China. The project is executed on behalf of the Federal Ministry for the Environment, Nature Conservation and Nuclear Safety (BMU) within the framework of the International Climate Initiative (IKI).

Objective

The overall purpose of the project  is to strengthen the capacity of and provide policy options to China’s key institutions and all involved stakeholders for preparing and establishing emissions trading schemes on regional and national levels. The project seeks to enhance the dialogue between policy makers in national and local government institutions, research organisations as well as private players such as carbon exchanges, financial service providers and industry.

Approach

The project focuses on capacity building and technical advisory for the establishment and implementation of ETS in China. The exchange of experiences and know-how between Chinese, German and European institutions is facilitated through advisory sequences and training measures such as study tours, workshops and job shadowing.

  • On the local level, the project addresses the pilot regions and assists local institutions in the technical adjustment to the ETS. Companies covered by emissions trading as well as further private players such as carbon exchanges, financial service providers and industry are included.
  • On the national level, the Domestic Policy and Compliance Division of the Department of Climate Change (DCC) of MEE is supported with demand-driven policy and  legislative-institutional advice on ETS design, infrastructure and implementation.

Results and Perspectives

So far, the project’s focus has been on the pilot regions, while it is shifting more towards national level support for the establishment of the national ETS. Activities have included technical advice on the design and establishment of carbon registries and trading platforms in the regions. Study tours and expert exchanges between Germany, Europe and China have facilitated the knowledge exchange and allowed Chinese stakeholders to draw on lessons learnt from the EU ETS. Sector specific trainings, such as for the building or cement industries, were organized and the dialogue between European and Chinese industry representatives strengthened.

The project strives to support Chinese stakeholders to draw on the lessons learnt in Europe and to establish a carbon market which suits China’s circumstances. As the national ETS was launched at the end of 2017, future project activities will focus on national and regional level activities.