Beijing will establish an exchange for trading carbon dioxide
credits under a new program launched Tuesday by the UN and the
Chinese government to help counter global climate change.
The platform, if successful, could be the first of its kind in a
developing country.
On completion, it would join those in the US and Europe as one
of the key centers for the multi-billion-dollar global trading
market for carbon dioxide credits.
The proposed exchange is part of a program to pilot carbon
trading in 12 western provinces, build capacity and provide policy
input for the expansion of the carbon market and reduction of
greenhouse gas emissions in China.
The three-year program, estimated to cost US$1.7 million, will
be partly financed by Arcelor Mittal, the world's top steel maker,
the UN said in a statement.
"Assisting China in its efforts to cope with the impact of
global climate change to create more sustainable, less
greenhouse-gas-intensive development paths is an important focus,"
said Khalid Malik, the UN's China coordinator. "A range of
market-based instruments has now emerged to support this effort,
with carbon trading emerging as a major opportunity."
Carbon dioxide credits, or the right to emit the gas that
scientists believe is the key contributor to global warming, are
issued by the UN through its Clean Development Mechanism under the
Kyoto Protocol. The credit can be traded on special exchanges,
through brokers or among companies.
Firms in industrial nations that have signed the Kyoto accord to
limit greenhouse gases can buy credits in registered projects such
as wind farms in developing countries. The credits can then be used
to offset Kyoto obligations.
In the new program, CDM technical service centers will be set up
in the Chinese provinces to act as brokers between global investors
and local partners to promote "green" investment in China's
less-developed regions. China now supplies more than a third of the
credits to the global carbon market under the CDM, the UN said.
The world body also said the new program will use carbon trades
as a tool to generate income for impoverished communities in
China's west.
Liu Yanhua, deputy chief of China's Ministry of Science and
Technology, said the project "presents an innovative market-based
approach to attract large amounts of foreign investment and
establish public-private partnerships in developing sustainable
energy solutions to alleviate poverty."
(Shanghai Daily February 8, 2007)
