China has relaunched its long-stalled voluntary carbon offset market, providing funding to projects with the potential to restrain emissions but facing challenges in generating profits.
National trading of the China Certified Emissions Reduction credits began on January 22 in Beijing, as reported by state-owned CCTV. The issuance of the credits was halted in 2017 to prevent surplus supply.
Efforts to restart the market have been ongoing for over a year, with the China Beijing Green Exchange chosen to host trading. Initially, the only credits available will be for projects approved before 2017, with the government is expected to start approving new projects later.
The Chinese government said in last year that new approvals would include solar thermal power, offshore wind, afforestation, and mangrove restoration.
China also has a separate national market for emissions allowances that currently covers the power sector, which is scheduled to be extended to other industries as soon as this year.
Polluters can buy voluntary credits to offset up to 5% of their emissions if they don’t have enough government-issued allowances.