Financial Soultions: China could send carbon credit prices rocketing.

Oct. 13, 2009 - PRLog -- Chinese President Hu Jintao’s recent statement that his country would achieve “notable” greenhouse gas emissions reductions over the next decade, backed by the government giving its seal of approval to its domestic emission trading scheme has sent signals that the worlds existing carbon markets could see significant changes in the near future, Financial Soultions research has indicated.

While the presidents declaration didn’t go as far as committing China to a capping program of energy sensitive industries as Europe had done, the establishment of a voluntary emissions trading strategy, combined with carbon reduction initiatives is indicative of China tackling its huge emission quantities

Financial Soultions understands that until now China has predominantly been in the business of selling carbon credits and in the process allowing western businesses to offset their emissions, but this position is about to change. With the new policies in place the globe largest carbon emitter will need to become a massive purchaser of credits, which is expected to drive the price of carbon to new levels.


At present the Chinese market is negligible, Financial Soultions understands, with only Shanghai-based Tianping Auto Insurance known to have purchased credits to offset its emissions. Demand though is anticipated to increase thanks to the initiatives announced by Jintao at the UN conference in New York last recently.

According to New Energy Finance, a clean-energy consultancy, it is approximated that China earns about £2.75 billion a year from the sale of offsets to the EU and Japan.

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