To standardize the voluntary greenhouse gas emission reduction trading and related activities across the country, China's Ministry of Ecology and Environment and the State Administration for Market Regulation jointly issued the "Greenhouse Gas Voluntary Emission Reduction Trading Measures (Pilot)" (hereinafter referred to as "the Measures") on October 19.
Voluntary greenhouse gas emission reduction trading represents a vital institutional innovation, leveraging market mechanisms to control and reduce greenhouse gas emissions and drive towards the goals of carbon peak and carbon neutrality. The national voluntary emission reduction market, combined with the national carbon emission rights trading market, forms China's carbon trading system. Once the voluntary reduction market is launched, various social entities can develop greenhouse gas reduction projects voluntarily in accordance with relevant regulations. After the project's emission reduction results are scientifically quantified and verified and registration is completed, they can be sold in the market to obtain corresponding emission reduction benefits. Launching the voluntary emission reduction market supports the development of forestry carbon sinks, renewable energy, methane reduction, energy-saving, and efficiency improvement projects. It encourages broader industry sectors, enterprises, and society to participate in greenhouse gas reduction actions, propelling the economic and societal transition towards green, low-carbon development.
"The Measures" serve as the foundational system to ensure the orderly operation of the national voluntary greenhouse gas emission reduction trading market. Comprising 8 chapters and 51 articles, the document provides regulations for every phase of voluntary reduction trading and related activities. It delineates the rights, obligations, and legal responsibilities of project owners, verification and certification institutions, registration agencies, trading institutions, and management responsibilities of ecological and environmental authorities and market supervision departments.
The core aim of "the Measures" is to serve the goals of carbon peak and neutrality. It emphasizes the "voluntary" nature, accentuates the role of market entities, and upholds the following basic principles:
Transparency and Enhanced Supervision: Social supervision is deemed a critical regulatory approach for voluntary emission reduction trading. It mandates timely and accurate disclosure of project and emission reduction information, based on the principle of "as much transparency as possible." Project owners and third-party verification institutions are required to make "double commitments" on the authenticity and compliance of projects and emission reductions. Governmental oversight during and after events ensures market integrity, fairness, and transparency.
Unified Management and Coordination: The method establishes a novel model of pre-event, during-event, and post-event joint supervision by both the ecological environment authorities and market regulation departments. A national unified registration agency and trading institution are set up to provide registration, trading, and other services. Third-party verification and certification institutions come under certification agency management.
Strengthening Foundations and Gradual Progress: The emphasis during the market's initial stages is on refining the institutional framework and improving management models. The focus is on elevating the normativity, rationality, and operability of policy frameworks. Once the market achieves stable initiation and operation, it will progressively expand the fields supported by the voluntary emission reduction market.
Domestic Focus, International Integration: By considering domestic realities and drawing from international experiences, and ensuring China's national interests, the relevant management requirements and technical specifications align with international best practices. The aim is to offer high-quality, tradable, and widely-accepted emission reductions, promoting the realization of the carbon peak and neutrality objectives.