ESG & Investing
China’s Carbon Price to Face Pressure From Surplus This Year
Pedestrians in front of a mixed gas-coal power plant in Beijing.
Source: Bloomberg
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China’s carbon market is set to expand to cover more polluting industries this year, but a persistent surplus and the expiry of old permits following a rule change may slow a price rally seen in 2024.
Total supply of allowances in the market — which currently only covers the power industry — rose to 5.2 billion tons in 2024, up 16% from its debut in 2021, the Ministry of Ecology and Environment said in a statement on Friday. On an annual basis, prices rallied 23% to 97 yuan per ton last year while the value of transactions increased more than a quarter, it added.