China's Carbon Emission Trading System Overview

This report is a comprehensive analysis of China's carbon emission trading system, detailing its historical evolution, current policy design, and future prospects. It outlines the development of the National Carbon Emission Trading System (National ETS), which was officially launched in 2021 and currently encompasses approximately 3,600 enterprises across four sectors: power generation, iron and steel, cement, and aluminum smelting. The report highlights the institutional framework and key policy designs of the National ETS, including cap setting, allowance allocation, and compliance mechanisms. It also reviews regional carbon emission trading systems, summarizing lessons learned from their implementation. The report concludes with recommendations for the future development of the National ETS, drawing on both international experiences and domestic low-carbon policy directions. This document serves as a valuable resource for policymakers, industry stakeholders, and researchers interested in carbon market strategies and climate change mitigation efforts in China.