Canada Wood Today | The Canada Wood Group

China Launches national carbon trading market

Eric Wong

By Eric Wong

Managing Director, Canada Wood China

January 8, 2018

China has rolled out the world’s largest carbon emission trading market, a milestone that marks the country’s efforts to tackle growing environmental challenges, China’s top economic planning body announced on Dec.19.The nationwide carbon emission trading scheme will start with more than 1,700 companies in the coal-fire power generation industry, which emit over 3 billion tons of carbon dioxide in total each year, said Li Gao, Chief of Climate Division under the National Development and Reform Committee, at a press conference of the launch event.

In the carbon cap-and-trade program, a regulatory body sets a maximum national “cap” on greenhouse gas emissions, which include carbon dioxide and five other major gases, and are measured in terms of carbon dioxide equivalent. Each company in the trading market will be given a quota on the amount of greenhouse gas it is allowed to emit and can trade its unused quota to others for profits, Li explained.

Companies in this way can be encouraged to lower its emission amount as much as possible and shift its business model to a more environmental-friendly way, Li said. China, one of the world’s largest emitters of greenhouse gases, has spent 15 years scouting the globe to learn from the mistakes of other nations and find the best ways to build a trading system of its own

Since 2011, China has kicked off seven pilot programs in two provinces and five cities where governments and companies have tinkered with cap and trade. Total turnover of the carbon trading reached 4.6 billion yuan in the past four years and overall volume of carbon emission has started to fall.

The launch of the carbon trading scheme is considered good news for wood construction industry.As a product from the nature, wood is an ideal construction material in terms of environment protection. Life cycle assessment studies have consistently showed that wood is better for the environment than steel or concrete in terms of embodied energy, air and water pollution, and greenhouse gas emissions. Wood products typically have less embodied energy, are responsible for lower air and water pollution, and have a lighter carbon footprint than other commonly used building materials.

Trees and forest products could play a critical role in helping to tackle climate change and reduce greenhouse gases. Using wood products that store carbon, as well as responsibly managing forests in a way that balances harvesting and replanting, can minimize China’s carbon footprint over the long term. In turn, wood buildings can require less energy to construct and operate over time.In addition, people feel an instinctive connection and attraction to natural materials, and evidence suggests this can contribute to an individual’s sense of well-being.

Canada Wood China is in a process to launch a joint research project with relevant Chinese governmental organization and reputable research institutes on wood performance of carbon footprint and sequestration with an objective of providing a scientific and technical basis to advance policy development towards wood products and wood construction.