This paper reviewed systematically practices and progresses of international and domestic emission trading policy in China during the past two decades, and concluded that emission trading is broadly used in the air pollutants reduction in USA, and the global carbon reduction with better effects, the emission trading policy exploration in China could be roughly divided into three stages: Initial Development stage (1988-2000), Piloting exploration stage (2001-2006), Deepening Piloting stage (2007-). Also, nine characteristics of the current emission trading practice in China were concluded and six key issues influencing the advancement of emission trading piloting were identified and discussed. And lastly, the paper proposed the pilot roadmap for implementation of the emission trading, and pointed out that efforts in the near future should focus on the construction of “six systems”, that are key technical supporting system, fair and reasonable allocation system of the emission permit, emission trading market system, laws and regulations system, pollution source monitoring and management system, and law enforcement and supervision system.
Because the effectiveness of payment for ecosystem services (PES) programs depends on landowners’ engagement, understanding the relationship between the type of payment and participation is a key issue. This paper reports on a choice experiment that quantifies landowners’ preferences for cash and educational in-kind payment. The main results indicate a positive correlation between participation in a PES contract and the magnitude of the cash payment, while participation seems uncorrelated with the magnitude of the educational in-kind payment. In addition, we investigate the mix of payment types and heterogeneity in preferences, which can help policymakers design strategies to increase participation.
One method to reduce greenhouse gas emissions is to subsidize emissions-reducing activities. The question is how to allocate such subsidies. Allocation through auctions is an emerging mechanism. In a controlled experimental market setting, this paper compares the effects of a variety of auction mechanisms for allocating subsidies for carbon emissions reduction in China. Besides the conventional auction mechanisms, this discussion paper place particular focus on testing the actual performance of the auction mechanism proposed by Erik Maskin (2011). The authors find that, while the Maskin auction mechanism spends the most from a fixed subsidy budget and leads to the largest emissions reduction, its per-unit emissions reduction cost is higher than that of discriminatory and uniform-price auction mechanisms. Both the Maskin and uniform-price auctions outperform discriminatory auctions in price discovery. Furthermore, from the government’s perspective, the Maskin auctions exhibit the strongest improvement tendency with repeated auctions.
This paper calculates, for the top twenty emitting countries, how much pricing of carbon dioxide (CO2) emissions is in their own national interests due to domestic co-benefits (leaving aside the global climate benefits). On average, nationally efficient prices are substantial, $57.5 per ton of CO2 (for year 2010), reflecting primarily health co-benefits from reduced air pollution at coal plants and, in some cases, reductions in automobile externalities (net of fuel taxes/subsidies). Pricing co-benefits reduces CO2 emissions from the top twenty emitters by 13.5 percent (a 10.8 percent reduction in global emissions). However, co-benefits vary dramatically across countries (e.g., with population exposure to pollution) and differentiated pricing of CO2 emissions therefore yields higher net benefits (by 23 percent) than uniform pricing. Importantly, the efficiency case for pricing carbon’s co-benefits hinges critically on (i) weak prospects for internalizing other externalities through other pricing instruments and (ii) productive use of carbon pricing revenues.
