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China Plans World’s Largest CO2 Market While U.S. Drags Its Feet

Eric Justian
| Wednesday September 3rd, 2014 | 28 Comments

Chinese flag American flagUpon learning today that China has a plan in place for a carbon emissions “cap and trade” market by 2016, my joy was mixed with frustration at U.S. foot-dragging. The D.C. gridlock and politicizing of energy sources like wind and solar — the politicizing of energy sources — has consistently ceded manufacturing and renewable energy technological ground to China and Europe for decades. Are we going to let that happen again with carbon markets?

Apparently so.

China aims to finalize its plans for the largest “cap and trade” program in the world by 2016 — a program that will eclipse the scope of European emissions trading. China’s market will be the main trading hub for Asia and the Pacific. It’ll place a cap on CO2 emissions from power plants and the nation’s many manufacturers. Basically, if an entity wants to emit carbon dioxide above the cap, it needs to buy permits from the market.

China has made a commitment to reduce its greenhouse gas emissions per unit of gross domestic product to about 45 percent of its 2005 emissions — and by 2020. Mind you, that’s no small feat.

While China is relatively low in terms of greenhouse gas emissions per capita, it is by far the largest total emitter of greenhouse gases in the world. It overtook the U.S. in emissions in around 2005 and has grown tremendously since. The nation currently weighs in at producing about 30 percent of the world’s greenhouse gases, while the United States comes in at about 15 percent and has remained more or less stable over time, even reducing its greenhouse gas emissions by a little.

But the U.S. shouldn’t pat itself on the back too much. We need to remember exactly how China overtook us in greenhouse gas emissions in the first place. We still have some of the highest emissions per capita in the world, and we haven’t exactly tightened our belts on consumption. For the past couple of decades we ripped up our own manufacturing capacity and sent it, and the emissions, to China. Here in the U.S., we also had the dubious benefit of going into a Great Recession for several years, which savaged our industrial output and job sector and had the side effect of dropping our emissions.

So here we are … China is now the largest emitter of CO2, and the U.S. has stabilized its own emissions growth. And yet, China now has a plan to drop its own emissions to almost half of its 2005 output in under six years. Meanwhile back in the states, we’re still wrangling, with a straight face, over whether climate change is an actual thing. The most ambitious change in U.S. policy is President Barack Obama’s requirement that U.S. power plants reduce their emissions to 30 percent of 2005 levels by 2030. Just power plants. Not manufacturers. A much less ambitious goal.

It’s entirely possible that China could once again overtake the U.S. when it comes to greenhouse gases — but on the opposite end of the spectrum — in just a few years. It’s embarrassing is what it is.

Image credit: futureatlas.com – source


▼▼▼      28 Comments     ▼▼▼

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  • acme

    Well, sure, that bunch iof commies want to save the world. They don’t know or care just how much money there is to be made by destroying it!

  • Shooi Dan Tom

    It s a great start, but you cant please all the China haters.

    • ldo

      Yep, after all …..the Chinese need to do something because, as an EXAMPLE….Beijing residents have to wear gas masks when they go outdoors.
      And the Chinese sure as heck cant use their rivers or streams for ANYTHING because of the toxic pollution.
      But the Chinese sure has “stolen” a heck of a lot of America’s industrial secrets.
      Further, Chinese women visit the U.S. routinely for “baby drops”.
      But what the hey…..who hates the Chinese ?
      That is almost like Mayor Emanuel requiring a police escort to go across the street from his mayor’s office to get lunch.

      • Shooi Dan Tom

        I agree with you. And the US should develop new and improved castles
        and Chain link fence to protect its border so that the US will become part
        of Mexico in 30 years instead of 15 years.

  • Nikolai

    Ooo! Ooo! Let’s do a “cap and trade” too! That way, we can make millions poorer when energy prices necessarily skyrocket!!

    • realist123

      exactly…only reason for Chinese copycat behavior is self serving, greed, domination of resources and greater concentration of political power…
      Not for any other reason…China’s environmental record is horrendous

      • EdwardInFlorida

        China is doing what it can to improve it’s environmental issues, more so than we are. On the other hand, the US refused to sign the Kyoto Protocol which obviously points out to the fact that they are protecting the interests of the ruling elite in the West. And let me remind you of who has used military force in the past 20 years to consolidate it’s power and control over resources in the Middle East! The truth hurts, doesn’t it?

    • ldo

      That is what Obama stated:
      “If my Cap and Trade gets instituted, then energy prices will SKYROCKET.”

    • http://trailsofarkansas.blogspot.com Trails of Arkansas

      Nikolai, that isn’t what has happened in places that have implemented Cap and Trade. http://cleantechnica.com/2014/09/05/u-s-carbon-markets-just-dropped-400-million-clean-energy/ In fact many US states already participate in regional Cap-and-Trade programs.

      • Nikolai

        The article says nothing about how much of that revenue generated on these markets is shifted to the consumers. That money does not simply will itself into existence.

        • http://trailsofarkansas.blogspot.com Trails of Arkansas

          You are free to research that information and post it here if you like. In my mind, these programs create local jobs, boost energy independence, improve public health, and protect the environment (all things that, like money, have value). Carbon tax and dividend programs are often revenue neutral and reward citizens who use less energy. Given that there is no fuel cost after solar and wind are built, they will save the consumer money in the long run. Don’t forget that taxpayers have subsidized coal, natural gas, oil, and nuclear energy to the tune of tens of billions of dollars a year for decades.

        • http://trailsofarkansas.blogspot.com Trails of Arkansas

          Here is a somewhat dated report, but it makes the case for net economic benefit to ratepayers in states under RGGI: http://www.ieta.org/assets/Reports/EmissionsTradingAroundTheWorld/edf_ieta_rggi_case_study_may_2013.pdf More jobs and less money sent out of region for oil, gas, and coal means more money in their pockets. And yes, that means more money than was raised on the cap-and-trade market.

        • Nikolai

          You cannot rewrite the laws of economics. The goal of any carbon tax, or cap and trade scheme, is to increase the cost of energy, particularly fossil fuel energy, and thus decrease demand, otherwise, there are no environmental gains. Unfortunately, this negatively impacts quality of life, especially for the poor.

          The cost of renewable energy is decreasing with time, and eventually it will be competitive with fossil fuel energy. However, the consequences of an abrupt, artificial increase in the cost of energy will do far more harm than any benefits derived, which is often glossed over by organizations that publish and advocate policies you seem to support.

        • http://trailsofarkansas.blogspot.com Trails of Arkansas

          Some of these plans provide subsidies or benefits for the poor, something you seem to not be aware of or be ignoring. Another point you’ve ignored is the fact that we are, and have been, artificially lowering the cost of electricity generated from fossil fuel and nuclear sources for decades through taxpayer funded subsidies.

        • Nikolai

          ~$10-50 billion is spent on oil subsidies, most of which are actually favorable tax breaks. ~$25 billion is collected from the federal gasoline tax. So it is probably a wash. I am not going to defend the oil subsides. It simply boils down to an unearned transfer of wealth from one entity to another. Bad policy is bad policy, whether for your cause, or mine.

  • Nightz

    This isn’t the only thing the US is dragging its feet on while the rest of the world moves on. Thorium reactors are being built (with our blueprints) in India and China, while Germany is planning to push its green energy program to 40% of all power generated.

  • siquijorisland

    Could be a very epensive move for a non problem in 2016 is it.

  • Timur

    The problem with the US is that US can’t copy anybody because it is the greatest.

  • fu china

    1.5 billion chinese who eat and fart every day it is impossible to control china emission,also,burning coal in china for energy are worse, this articles can not fool me,CHINA CAN NOT CONTROL CO,tell all chinese to stop eating and farting then the environment can breathable with clean air,tell all chinese go back to bicycle no car then china are clear, who ever wrote this articles is dumb and stupid ,write b.s for stupid people to read about china

  • Oldman

    US is a democracy. We never rush thru things. China doesn’t have the check and balance political system like ours so it is not surprised they can move so fast. Don’t worry, give it a few years our congress will sort it out.

  • EdwardInFlorida

    The China haters have low self esteem. They have to take out their perceived inadequacies on China and other nations that don’t see “eye to eye” with Washington. They darn well know the US empire is on it’s way out, and China is raising, and they can’t do a damn thing about it!

  • Thuong Ngo
  • Carol Shendock

    If you do not believe this article, just walk around some of China’s biggest cities !

  • SF

    China is on the move, fast. Here in CA, we just finished replacing a quake damaged bridge, took 24 years with major parts made in China. I once saw a presentation that China built similar bridge in 2 years, including design.

  • Juan Perezchica

    Kudos to China for taking the brave action few in the United States are willing to. This is one issue that China is becoming increasingly right about!

  • MGSfan

    I was pretty disappointed when China and India earlier decided to not make commitments to cut greenhouse gases. It seems like China reversed it’s position and I’m pretty happy about it. Nothing but praises for its decision.

  • 老师 laoshi

    I live and teach in China….and have been for 10 years….AND everyone who knows or lives in China KNOWS this “cap and trade” is pure BS….面子 from the Chinese government. BUT like I tell my students; you can believe anything you want.

  • tenaciousD

    Not quite sure how this going to work since China IS the market, so are they capping and trading amongst party members who control the energy sector? Cap and trade only works where there are free market dynamics and this is obviously not the case in China.