The central government is considering a massive campaign of environmental-impact assessment over enterprises in the overheating steel, aluminum and cement sectors.

Zhang Lijun, department director of the State Environmental Protection Administration (SEPA), said the campaign is part of the State Council's soon-to-come package of measures to cool down excessive growth in the sectors.

"We will firmly close those enterprises that cannot meet the country's minimum pollution emission standards," said Zhang.

Since April of this year, the National Development and Reform Commission has continually warned about the speed of growth in some industries including cars, steel, aluminum and cement that could have a serious economic impact.

Zhang said many rely on outdated technology and equipment, affecting their ability to control pollution. They have a tendency to consume high levels of energy and some are sources of air and water pollution.

Zhang revealed the information at yesterday's wrap-up ceremonies for a three-year pilot project of emissions trading between SEPA and the US Environmental Defence (EDF) organization.

The project is based on existing caps that limit the amount of pollution produced by industrial sources, such as power plants and other factories.

When emissions fall below the permitted levels, factories are allowed to store excess quotas for future use or to trade with other industrial units that cannot meet the pollution standards set by environmental protection authorities.

The end results provide buyers with increased emission quotas, a must for future expansion, while sellers are rewarded for their contributions to environmental protection.

"The program has been conducted steadily and we have made important initial achievements," said Zhang, adding that the practice is likely to expand to other pollution controls.

Chief economist for the EDF Daniel J. Dudek said the practice can help industrial units tackle the nation's air pollution problems and deliver more practical information to its environmental protection decision-makers.

The pilot program between SEPA and Dudek's organization has been implemented in Shandong, Jiangsu, Shanxi, Henan provinces, Shanghai, Tianjin and Liuzhou in the Guangxi Zhuang Autonomous Region with great success

(China Daily December 12, 2003)