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Greenlaw from NRDC China’s Blog

China Environmental News Alert (6/23 - 6/28/2014)

Greenlaw from NRDC China

Posted June 28, 2014

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June 23 - 28, 2014

NRDC has been working in China for over fifteen years on such issues as energy efficiency, green buildings, clean energy technologies, environmental law, and green supply chain issues. This China Environmental News Alert is a compilation of news from around the world on China and the environment.

Top court considers launch of green tribunal
China Daily (June 28, 2014)
The Supreme People's Court is considering setting up an environment and resources tribunal to hear complex environmental disputes and solve increasingly severe pollution problems, according to insiders.  Experts have confirmed the move to China Daily, but the court declined to comment on the issue on Friday. An official announcement is expected within days.  Wang Canfa, an environmental law professor at China University of Political Science and Law, said environmental dispute cases are unique.  It can be hard to identify those responsible, damage can have been caused over a long period and both the environment and local residents can be affected, Wang said.  Setting up a government body specializing in such cases can promote the role of the judges and ensure that cases are resolved fairly, he said.  Compared with environment and resources tribunals at local level, legal experts expect the top court's tribunal to involve different functions, such as providing guidelines to the local tribunals and hearing individual environmental cases.

As LED industry evolves, China elbows ahead
The New York Times (June 17, 2014)
A year ago, China’s light-emitting diode industry seemed like a case study of industrial policy gone awry. Hundreds of factories built all over eastern China, often with lavish clean energy subsidies from state-owned banks and local governments, were operating at half capacity. The share prices of LED manufacturers were plunging.  Now demand is surging, and the Chinese manufacturers suddenly find their factories running at full tilt, churning out LEDs faster and cheaper than global rivals. With a price war underway, the Chinese are taking share from top players in the United States, Europe and Japan, the industry pioneers that made crucial technological breakthroughs, and from Taiwan and South Korea, previously the leaders in low-priced LEDs.  For some in the United States, the Chinese expansion has uncomfortable echoes of the solar panel and wind turbine industries, in which China went from a bit player to global leader through a combination of extensive government subsidies and low-interest loans from state-owned banks.

China launches final carbon market
Reuters (June 23, 2014)
Chongqing, a sprawling metropolis of 30 million people on the Yangtze river, follows the cities of Shenzhen, Shanghai and Beijing and the provinces of Guangdong and Hubei in launching a trading scheme that allows big local firms to buy and sell permits that cover their carbon emissions.  Some participants at the Chongqing launch were sceptical about the effectiveness of the platform, saying that the much-delayed launch was rushed and choreographed.  "It is a symbolic launch - all the deals announced today were negotiated at 30-32 yuan, and we bid for the volume at the same level as others, at 10,000 tonnes," said a buyer with a power company on the sidelines of the launch ceremony.  China's top climate change official, Xie Zhenhua, who was present at the six prior launches, did not attend the opening ceremony. Only 16 deals were signed, covering 145,000 tonnes of permits at a price of 30-31.5 yuan ($4.83-$5.07) per tonne.

Shenzhen may add cars to its carbon trading pilot program next year
Bloomberg (June 16, 2014)
Car buyers in the southern city of Shenzhen could be required to purchase carbon quotas along with their vehicles as early as next year if the city's pilot carbon trading program is expanded, a city official said.  Shenzhen, which is among a half dozen areas of China that are experimenting with carbon trading, could add private vehicles and other parts of the transportation sector to the carbon trading mix as early as next year, Vice Mayor Tang Jie said June 11.  The China-Shenzhen Emissions Rights Exchange (CERX), which launched in June 2013, has so far covered only industrial emissions from 635 companies and 197 larger buildings. But speaking at a low-carbon forum in the city, which borders Hong Kong, Tang said, “We have to try to use a carbon finance approach to change the way people travel.”  While industrial emissions in Shenzhen have peaked and should drop by 2 to 3 percent annually in each of the coming five years, vehicle emissions will continue to grow as car ownership surges, Tang said. The transport sector now accounts for about 30 percent of the city's total emissions.

Beijing emitters trade 1.6 million carbon permits in first 7 months of pilot program
Reuters (June 27, 2014)
Big emitters traded up to 1.6 million carbon permits on the Chinese capital's pilot emissions market in its first seven months of operations, the exchange said on Friday.  Traders and auditors blamed poor liquidity on participants' lack of expertise, and on complaints that drove off others.  With 47 million permits on offer by Beijing in the 2013 compliance year, the figure of permits traded reflects a turnover rate of just 3.4 percent.  In contrast, about 64 percent of the offered volume is traded through two-way talks offline, data compiled by the trading platform, the China Beijing Environment Exchange, shows.  Beijing is the first of China's seven carbon trading pilot markets to reach a June 27 compliance deadline under a cap-and-trade system, although the date had been delayed nearly two weeks because of opposition from participants.  Some of the participants, which include universities and hospitals, lacked the high degree of expertise necessary for trading, said an auditor responsible for verifying firms' emission data.

Silver lining for China's carbon-financed wind power boom
Forbes (June 27, 2014)
China’s wind power industry was among the biggest beneficiaries of the United Nation’s Clean Development Mechanism (CDM), a carbon trading scheme that used funds from wealthy countries to support clean energy projects in developing countries.  The CDM allowed industrial countries to satisfy commitments they had made to cutting greenhouse-gas emissions under the 1997 Kyoto protocol.  In 2005, wind power project developers began applying for CDM funding in droves. By 2009, nearly 75% of all wind power projects in China had registered with the CDM.  As a result, the CDM’s board rejected more than a dozen Chinese wind power project proposals as a result of concerns that Beijing had deliberately lowered subsidies to ensure more projects would be eligible for funding.  The CDM’s board unprecedented mood resulted in a significant slow-down and exacerbated already intense criticism of the CDM’s environmental benefits.

Five years later, a bit of good news has surfaced about the CDM’s impact on renewable energy in China.  In The Learning Process and Technological Change in Wind Power, Tian Tang and David Popp, both professors of public policy at Syracuse University’s Maxwell School, assessed the impact of multiple types of “technology learning” on the cost of wind power projects in China built between 2002 and 2009. More specifically, the study considered “learning-by-searching through R&D in wind turbine manufacturing, learning-by-doing from previous experience of installation, and learning-by-interacting through collaboration between wind turbine manufacturers and project developers.”  It turns out that “learning-by-interacting” matters more than the other types of technology learning – at least for purposes of reducing the per unit cost of wind turbines installed in China.

(CENA prepared by Jeffrey Wong)

The links and article summaries in this post are provided for informational purposes only and do not necessarily reflect the views or positions of the Natural Resources Defense Council.

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