China intends to
establish a seventh emissions trading system, consistent with the
National
Development and Reform Commission (NDRC).

This latest system will begin in the city of Shenzhen, which is
expected to develop it’s own scheme despite being located in the
province of Guangdong - already approved for a cap and trade
system. Shenzhen’s GDP grew to $150bn USD in 2010 and has a larger
economy than countries such as Kazakhstan and New Zealand.

The central government of China has identified emissions trading
as the most cost effective tool for encouraging companies to cut
greenhouse gas emissions, and intends to use the experience from
the seven markets to assist with designing and launching a national
system in the coming years.

This news follows the href=”http://www.pics.uvic.ca/assets/pdf/news/NewsScan109_25Oct2011.pdf”
target=”_blank”>decision of the California Air Resources Board
(ARB) unanimously approving a final draft of the state’s cap and
trade plan.

Both Shenzhen and California are heavy emitting jurisdictions
and recognize that balancing environmental sustainability and
economic growth is not a zero sum game.

Cap and trade systems encourage heavy polluting legacy
industries, such as shale gas extraction, to evolve cleaner
business models, while at the same time unlocking the economic
potential embedded in the establishment of an entirely new, and
multi-billion dollar market.