Week at a glance (April 4 – April 8, 2022)
- The Qingming-Holiday shortened trading week saw activity on China’s national Carbon Emissions Allowance (CEA) market rebounding somewhat from the previous week to 135,045 tons. Block trades came back on Friday from a two-week absence with a volume of 130,000 tons, accounting for nearly all of the week’s volume. Open market transaction prices closed the week at 59.99 yuan/ton ($9.42/ton), a 2.55% increase from the previous week, continuing the steady upward price trend seen in recent weeks. The volume-weighted average price for all trades was 57.11 yuan/ton ($8.97/ton) for the week.
- Activity across the nine China certified emission reductions (CCER) markets decreased 26.6% from the previous week to a combined total volume of 135,474 tons. Tianjin led the markets with a nearly 60% share of the total volume. Last week’s average CCER credit price on the Shanghai market was slightly higher than that of the CEA’s, at 58.09 yuan/ton. The Sichuan market’s weekly average CCER price exceeded that of the CEA’s for three weeks in a row.
- According to a study published by the Tianjin Climate Exchange, the leading exchange for CCERs in 2022, there are currently three main sources of demand for the CCER: China’s National CEA market, the CORSIA (Carbon Offsetting and Reduction Scheme for International Aviation), and the international voluntary carbon offsetting market. Cumulatively and combined, they will have a demand of about 4.1 billion tons of credits by 2030. On the supply side, taking into account potential new credit-eligible projects under conservative assumptions for credit quantification, in addition to existing registered credits and approved credit-eligible projects, cumulative CCER credit supply may be close to 4.3 billion tons by 2030, which is roughly equal to the estimated demand.