In order to limit the rapid growth of greenhouse gas emissions, China has decided to implement seven pilot schemes for emissions trading, which are expected to start operating in 2013, with a view to implementing a nation-wide scheme in the future. To support this effort, the EU-China Exchange on Challenges and Best Practices in ETS brought together representatives from the different pilot schemes, participants from the private sector, and European experts. Benjamin Görlach, Senior Fellow at the Ecologic Institute, gave a presentation on the impact of emissions trading on the power sector, and the procedures for effective MRV in the power sector.

The first in a series of three workshops addressed the role of the power sector in an emissions trading scheme. Due to its share in overall emissions, and the relatively high concentration, the power sector is typically included in any trading scheme for greenhouse gas emissions, including the seven Chinese ETS pilots. However, for the Chinese power sector, with a high share of state-owned companies, with regulated prices for both fuels and electricity, and with a rigid system for grid management and plant dispatching, the application of ETS represents a particular challenge.

Preparing industry players for their participation, both at the sector association and installation level, will be crucial to ensure that the ETS pilots are successfully implemented and industry is engaged. The workshop offered a forum for a wide range of stakeholders, particularly the private sector, to exchange experiences and common challenges in ETS in the power sector.