Oct. 18 (Bloomberg) -- China, the top greenhouse-gas emitter, will continue to test carbon markets and may consider a tax at a later stage to reduce pollution levels, according to a National Development & Reform Commission official.
Seven pilot programs for markets are going “pretty good,” Jiang Zhaoli, head of climate change at NDRC, said yesterday at a briefing in Beijing, without being more specific.
China is seeking to cut emissions per unit of economic output by at least 40 percent by 2020 from 2005 levels. The Intergovernmental Panel on Climate Change said Sept. 27 there’s enough space in the atmosphere for about 309 billion metric tons of carbon, or about 22 years of emissions at current levels, for a chance to prevent runaway climate change. United Nations envoys are seeking to seal a climate agreement by 2015 that would curb emissions from 2020.
“Carbon trading is a very good tool for China to reduce emissions right now,” Jiang said. “The carbon tax, I believe, is also an important tool but the current conditions are not mature enough to launch this policy.”
China may introduce a tax on emissions as part of environmental protection charges, Xinhua reported Feb. 19, citing Jia Chen, head of the Ministry of Finance tax department.
“We hope from international experience and from our pilots to discover whether we should have a carbon tax or carbon trading or both,” Jiang said. “This is what we are considering at the moment.”
Carbon markets are about 94 percent cheaper at cutting greenhouse gases than renewable subsidies paid to power producers, the Organization for Economic Cooperation and Development said Oct. 9 in a report.
The U.K. this year imposed a carbon price floor support tax to help spur investment in nuclear energy, even as its factories and power stations participate in the European Union carbon market, the world’s biggest. Sweden and British Columbia in Canada are among other jurisdictions with taxes.
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