The Ministry of Ecology and Environment responded! What are the changes in the total quota and new allocation plan of the power generation industry

On August 30, the Ministry of Ecology and Environment held a regular press conference in August. A reporter asked at the meeting that recently, the Ministry of Ecology and Environment reviewed and passed the "National Carbon Emission Trading Power Generation Industry Quota and Allocation Plan for 2023 and 2024". What changes have occurred in the new plan? In addition, some industry insiders said that under the promotion of the new carry-over policy, the release of large amounts of quotas in the market may increase the fluctuations in carbon prices. How does the Ministry of Ecology and Environment evaluate this?

Pei Xiaofei, Director of the Propaganda and Spokesperson of the Ministry of Ecology and Environment, said that in accordance with the decisions and deployments of the CPC Central Committee and the State Council, our department has actively promoted the construction of the national carbon emission trading market. Since July 2021, the power generation industry started online trading, and has successfully completed two performance cycles. At present, our department is taking the lead in carrying out related work in the third fulfillment cycle. In accordance with the overall requirements of "seeking progress while maintaining stability, serving the overall situation, and encouraging advanced", it has prepared the "Total Quota and Allocation Plan for the National Carbon Emission Trading Power Generation Industry in 2023 and 2024".

The "Plan" combines the new work situation requirements and opinions and suggestions from all parties, and makes the following aspects optimized and adjusted.

First, optimize the fulfillment time schedule. From fulfilling a contract every two years to fulfilling a contract every year. The first two performance cycles of the national carbon market are fulfilled every two years. The "Plan" sets the deadline for fulfillment of the two years 2023 and 2024 to the end of 2024 and the end of 2025 respectively, achieving one-year performance, alleviating the problem of crowded transactions and enhancing market activity.

The second is to adjust the statistical accounting scope. In order to prevent data quality risks from the source and improve the scientificity and rationality of quota allocation methods, the "Plan" has improved in several aspects such as adjusting the quota volume to calculate basic parameters, optimizing the management and control scope, simplifying and optimizing various correction coefficients.

Third, the carbon emission benchmark value under comparable caliber is slightly stricter. Taking into account the progress of completing the national carbon emission intensity target in the 14th Five-Year Plan, the carbon emission benchmark values in 2023 and 2024 can be reduced by about 1%. This method can not only maintain a certain pressure on emission reduction, but also be within the affordable range of enterprises to ensure the smooth operation of the market.

On this basis, in order to effectively solve the problems of quota surplus enterprises being reluctant to sell, inactive market transactions, and high pressure on enterprises with quota gaps to fulfill their contracts, we have proposed quota carry-over measures based on in-depth research and fully learning from the mature experience of the domestic and foreign carbon markets. In fact, only enterprises with quota that need to be carried forward are surplus. For 2024 and previous years, a certain proportion of the surplus quota needs to be sold to carry over the remaining part into 2025 quota for quota. It is estimated that under the current carry-over measures, quota surplus enterprises will gradually release quota amounts roughly equivalent to the demand for fulfillment to the market to better balance market supply and demand. In addition, the carry-over deadline is set to December 31, 2025, leaving enough time for enterprises to formulate trading plans to avoid crowded transactions in the short term, resulting in abnormal fluctuations in carbon prices.

In the next step, we will strengthen market management, closely track the trading activities of key emission units, jointly do a good job in risk management, and maintain the healthy and orderly development of the carbon emission trading market.