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Research on the initial allocation of carbon emission quotas: evidence from China

Author

Listed:
  • Yu-Jie Hu

    (Beijing Institute of Technology
    Beijing Institute of Technology
    Collaborative Innovation Center of Electric Vehicles in Beijing)

  • Rong Han

    (Beijing Institute of Technology
    Beijing Institute of Technology
    Collaborative Innovation Center of Electric Vehicles in Beijing)

  • Bao-Jun Tang

    (Beijing Institute of Technology
    Beijing Institute of Technology
    Collaborative Innovation Center of Electric Vehicles in Beijing
    Sustainable Development Research Institute for Economy and Society of Beijing)

Abstract

In November 2015, China government announced that the national carbon emissions trading market is expected to start in 2017. Carbon emission trading system is a raising concern from day to day, in which the allocation of carbon quotas has the closest relationship with trading units directly determining the cost of carbon trading. Initial allowance allocation is fundamental, but it proposes difficulty in terms of the trading mechanism design. This paper is based on the total control principle of national layout, in which the government sets up the cap of emissions in the carbon emissions trading system and focuses on the historical emission allocation concept from the perspective of fairness and history responsibility meaning that the allocation of quota in the future is based on the historical emissions. Firstly, we carry out comparative analysis based on the economy development and the emissions of 31 provinces and cities in China and select the sign-post province, Hebei. Secondly, we take the sign-post province as benchmarking and compare the benchmarking with the other provinces on the economy to set three quota situations of different initial years. Finally, we conduct quota calculation of residual carbon dioxide of various provinces by the end of 2020 and provide the specific quota calculation plans under different situations. The result of quota indicates: Most provinces still have more or less surplus to reallocate by the end of 2020; some provinces and cities have developing economy at expense of large emission and old industrial area with high energy consumption and high coal demand are in the shortage of future emission space; for the developed areas, the earlier emissions accounting is not good for their owning surplus; the earlier the years we select as the starting to account the quota, the greater the reductions space we will have. Meanwhile, we carry out testing of the feasibility of self-providing quota plans. These results may provide corresponding policy advice for China.

Suggested Citation

  • Yu-Jie Hu & Rong Han & Bao-Jun Tang, 2017. "Research on the initial allocation of carbon emission quotas: evidence from China," Natural Hazards: Journal of the International Society for the Prevention and Mitigation of Natural Hazards, Springer;International Society for the Prevention and Mitigation of Natural Hazards, vol. 85(2), pages 1189-1208, January.
    • Handle: RePEc:spr:nathaz:v:85:y:2017:i:2:d:10.1007_s11069-016-2628-y
    DOI: 10.1007/s11069-016-2628-y
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    Cited by:

    1. Chang-Jing Ji & Xiao-Yi Li & Yu-Jie Hu & Xiang-Yu Wang & Bao-Jun Tang, 2019. "Research on carbon price in emissions trading scheme: a bibliometric analysis," Natural Hazards: Journal of the International Society for the Prevention and Mitigation of Natural Hazards, Springer;International Society for the Prevention and Mitigation of Natural Hazards, vol. 99(3), pages 1381-1396, December.
    2. Tan, Xianchun & Cai, Xiaoli & Cheng, Yonglong & Yan, Hongshuo, 2024. "How to control China's total amount of carbon emissions? An analysis of provincial allowance demands," Energy, Elsevier, vol. 303(C).
    3. Shi, Wei & Li, Wei & Qiao, Fuwei & Wang, Weijuan & An, Yi & Zhang, Guowei, 2023. "An inter-provincial carbon quota study in China based on the contribution of clean energy to carbon reduction," Energy Policy, Elsevier, vol. 182(C).

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