China Carbon Market Weekly Update – Feb 14, 2022

Week at a glance

• China’s national Carbon Emissions Allowance (CEA) market resumed trading after the week-long Chinese New Year holiday. Its total weekly volume recovered from pre- holiday lows but still sat at a very low 72,438 tons. Block trades were absent for the third week in a row. Open market transaction prices closed the week at 56.15 yuan/ton ($8.84/ton), decreasing 8.52% from the previous trading week.
• Activities across the nine China certified emission reductions (CCER) markets retreated 84.6% from a relatively active week before the holiday break to a low total volume of 59,560 tons. Only Tianjin and Sichuan had trades, with the former accounting for the majority of the total volume.
• On February 8, led by the People’s Bank of China, the State Administration for Market Regulation, the Banking and Insurance Regulatory Commission, and the Securities Regulatory Commission jointly published the Development Plan for Financial Standardization for the 14th Five-Year Plan (the “Development Plan”) aiming to build “a standards system befitting a modern financial system” by 2025. On financial innovation, the Development Plan names, among others, the following major work areas: developing carbon emissions standards for financial institutions, establishing a standards system for ESG evaluation, establishing an accounting standard for quantifiable carbon reductions from loans, and promoting the synchronization of domestic and international green finance standards.