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BPMR Dialogue with State Owned Enterprises for the national ETS, BeijinG, China, 2016

             

SUMMARY

The B-PMR held a Dialogue with Chinese state-owned firms in Beijing on December 13, 2016 to help share lessons learned on emissions trading participation and market readiness.

Held in partnership with our Chinese partner, CECEP, the Dialogue brought together +20 IETA member companies and +125 state-owned firms who will participate in China’s national emissions trading system (ETS) from 2017 onwards. 

At the start of the Dialogue, Mr. Jiang Zhaoli-Deputy Director of the Climate Change Department at the National Development and Reform Commission (NDRC) offered the following remarks:

    •  The central government will launch a national ETS in 2017.
    • The NDRC has approved all rules related to allocation and the total volume of allowances which will be distributed in 2017.
    • There will be +7000 companies that will participate in the national ETS.
    • The national ETS will be key in changing China’s economic growth patten and improving China’s economic competitiveness.
    • While there may be uncertainties about the national ETS at this stage, the NDRC welcomes international companies to help Chinese companies prepare for the ETS and share their opinions on the ETS design.

Mr. Jiang was very supportive of IETA and CECEP’s efforts to hold the B-PMR Dialogue and encouraged more cooperation for 2017.

The first half of the day was dedicated to experience sharing from IETA member companies on ETS compliance and trading strategies. The second part of the day was dedicated to an ETS trading simulation facilitated by BP Trading.

AGENDA

The agenda for the Diaglogue.

PHOTOS

PRESENTATIONS

Mr. Ingo Ramming

What are the key steps to trade in an ETS?
    • Data is crucial to trading, if data is collected properly then trading cannot be conducted properly either.
    • An efficient carbon strategy can help maximise the value for a company.
    • Volatile exposure to carbon markets can occur if planning and defining a carbon strategy isn’t put in place early on.

2. Technical Session: Carbon Trading Best Practices

Moderator: Mr. Jeff Swartz, Managing Director, IETA

Best practice sharing  on carbon trading experiences:

Mr. Caspar Chiquet

In-depth carbon trading experience sharing from South Pole Group
    • Establishing a forward carbon price curve is very important, but comes with challenges.
    • Carbon markets behave differently based on how much buying and selling is taking place-managing this volatility is important for a trading strategy.

Mr. Tong Yan

In-depth carbon trading experience sharing from Guotai Junan
  • Guotai’s brokerage branches throughout China will offer carbon services.
  • State-owned firms in China will benefit from having a centralised carbon management team
Guotai recommended on how to set-up carbon trading business in the steps as following:

1.          Gain the approval and support from high-level;
2.          Full awareness of the risks in carbon trading and acquire containable authorization;
3.          Build a trading team
4.          Trying out business with cautious approach         
5          And for Yifeng of Shanghai Zhixin, the following points please:


During the pilot period, Zhixin has facilitated the State Grid in participating into the national ETS in mainly 6 aspects:

1. Build substantial GHG emission data base and research on establishing MRV system or carbon emission;

  • Emission reporting has been fully enforced in all the electricity and gas companies at provincial level. The emission report is submitted by provincial DRC, covered the GHGs are CO2 and SF6;   
  • Relevant data is also collected in the headquarter to develop internal MRV system, increase the management efficiency and capacity of GHG data, serving to the national GHG emission report. 
2.          Set-up the management system of carbon emission
         

Covered entity needs profound management system and comprehensive guarantee mechanism to meet its emission                              reduction target, that including organizational structure, internal MRV mechanism, carbon asset development and                                    trading approach, cost assessment and identification mechanism for emission reduction technologies, team building, IT                          support, etc. 


3.

          Capacity building to carbon asset management
         In cooperation with renowned experts in national and international emissions trading, various capacity trainings have been                    implemented in low carbon economy, carbon asset management and MRV.  

4.      CCER Project and Methodology Development 

5.      Innovation in carbon trading and carbon financing 

6.      Voice of the sector in ETS discussions




Mr. Jaime Wallace

BP
In-depth carbon trading experience sharing from BP
    • BP has worked in China’s ETS’s since they launched in 2013 and has a CCER portfolio that is delivering in excess of 5 million tonnes of CCER’s until 2020 and beyond.

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