Cap-and-trade scheme: step forward - Sara Hsu

Sara Hsu

While much work remains to be done, China and the US has set an important step forward in curbing carbon emissions, writes analyst Sara Hsu in the Diplomat. "At present, China’s cap-and-trade systems do not address price distortions in the nation’s socialist economy."

Sara Hsu:

At present, China’s cap-and-trade systems do not address price distortions in the nation’s socialist economy. Electricity prices continue to be controlled, encouraging electricity consumption. What is more, allocation based on grandfathering has resulted in higher standards for newer firms. Double-counting of emission allowances for both consumers and producers has produced an inefficient supply of allowances, and most allowances are currently free rather than sold at auction. China’s cap-and-trade system is also relatively nontransparent in terms of giving out allowances and monitoring the effectiveness of the cap-and-trade schemes. 

These issues presented in China’s pilot cap-and-trade programs must be addressed in the national program. The National Development and Reform Commission has made a general statement that it will attempt to improve the regulations surrounding carbon trading schemes. 

It should also be kept in mind that a cap-and-trade program cannot be considered a standalone policy in the war against climate change. Cap-and-trade programs have limitations, since not all emissions are easily monitored; they come from various sources and cannot be evaluated and “capped.” Programs that place an emphasis on moving to renewable energy, reducing household use of fossil fuels, improving mass transit, and enhancing energy efficiency must complement any cap-and-trade scheme. 

Despite producing the world’s largest volume of emissions, China has been a leader in the use of renewable energy. China’s carbon-curbing plan and the effectiveness of its proposed emissions targets will among the important topics of discussion at the UN climate talks in Paris later this year.

More in the Diplomat.

Sara Hsu is a speaker at the China Speakers Bureau. Do you need her at your meeting or conference? Do get in touch or fill in our speakers´request form.

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Less carbon, more bicycles in Shanghai

In China making a difference between official rhetoric and reality is often tough. But what I saw this morning in Shanghai is real: an extensive orange bicycle program that allows citizens literally to take a free ride. Just outside the compound where I stay for the time being, I found this row of orange bicycles.
They are part of a municipal program to reduce the carbon imprint and reduce the pressure on the traffic on four wheels. Later I saw more of those rows and most subway stations have one, people told me. It is meant for local citizens who have to register with their neighborhood committee, they will get an electronic card to release the bikes without any charge.
An overnight maintenance team makes sure the bikes remain in a good condition. The program is not meant for tourist and you will find the bikes only in the suburbs, not in the city center (where the local government often tries to get rid of bicycles).
According to my informants the bikes are pretty popular; anything in Shanghai that is for free would be popular, of course.

Low carbon economy key for private companies - Rupert Hoogewerf

Hurun by Fantake via Flickr

China's private business are starting to look overseas, says China's rich list Hurun founder Rupert Hoogewerf. Key for their global success will be their management style and adaptation of a low carbon economy, he tells Beijing Review.

One of the biggest challenges may come from managing foreign businesses. Chinese managers must find new ways to supervise foreign employees since Chinese management styles may not translate well, or provide a comfortable work environment for international employees. Training methods are already being adapted for managers with foreign staffs, and Hoogewerf expected major breakthroughs to follow in the coming years.

Hoogewerf pointed out the necessity for Chinese private companies to follow the low-carbon economy trend. The low-carbon economy is a social responsibility for everyone, and is being widely embraced by countries worldwide, he said.

Many private enterprises are making more environmentally friendly products to maintain a competitive edge as customers' demands for such products increase. And, generally speaking Hoogewerf said, this trend is progressing much quicker than people think.

Commercial
Rupert Hoogewerf or Hurun is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch.