China Carbon Weekly Market Update – Dec 20, 2021

Week at a glance

  • The total weekly trading volume on China’s national Carbon Emissions Allowance (CEA) market more than doubled from the previous week to 53.7 million tons, setting a record for the third time in a row. The weekly volume of block trades also set a record at 47.0 million tons. The single-day block trades volume on December 16 also set a record of 19.6 million tons. The total volume-weighted average price for the week was up slightly to 40.13 yuan/ton ($6.29/ton), far lower than the headline open transactions closing price of 46.66 yuan/ton ($7.32/ton).
  • The total weekly volume of the China certified emission reductions (CCER) markets decreased by 88.3% from the previous week to 3,096,866 tons. Only Shanghai, Beijing, and Shenzhen saw meaningful volumes, with Shanghai leading all markets at 1,557,753 tons. Shanghai saw an average price decrease of 13.1% to 29.86 yuan/ton ($4.68/ton) while Beijing saw a modest decrease of 1.5% to 38.62 yuan/ton ($6.06/ton),
  • The China Development Bank (CDB), one of China’s three Policy Banks, published its Action Plan for Implementing the Green Low Carbon Finance Strategy and Supporting the Carbon Peaking-Carbon Neutrality Goals on December 14, 2021, pledging a five- percentage point increase of green loans as a portion of its total credit assets by 2025 to support the country’s “Two-Carbon” goals. Such an increase would amount to roughly 850 billion yuan ($133 billion) over the next four years.
  • The China Construction Bank (CCB) Issued an overseas dollar-denominated floating rate green bond of $500 million with a three-year term. Projects financed with the bond proceeds will comply with the new EU-China Common Taxonomy for Sustainable Finance, making it a global first for green bond issuance.
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