China Carbon Weekly Market Update – Sep 13, 2021

Week at a glance

• China’s carbon emissions allowance (CEA) market saw some recovery in trading volume after last week. Total volume increased almost tenfold to 6,312 tons, with no block trades. Closing prices decreased 1.5%, at RMB 44.00/ton (USD 6.83/ton). The downward price trend continued as traders held on to their credits, anticipating future price rises once financials are cleared to participate.
• The total volume of China certified emission reductions (CCER) decreased 32.3% to 1,788,559 tons, while individual markets remained volatile. Prices were mostly lower for exchanges with available information. Shanghai saw the most volume, likely due to the approaching September 30 deadline for the 2020-compliance year.
• China launched a pilot green power trading scheme, with 259 entities trading over 7.9 billion kWh on the first day. A premium of RMB 0.027-0.050/kWh was paid over local mid-to-long-term prices in the areas covered. It is not yet clear how this will impact CCER.