In the view of industry experts, the worldCarbon neutralityUnder the net zero emission vision,Carbon priceIt is expected to continue to improve gradually.

The "Domestic and Foreign Energy and Electricity Price Analysis Report (2023)" (hereinafter referred to as the "Report") recently released by the State Grid Energy Institute for the first time, it shows that in the long run, the global market will beCarbon marketIt shows a situation of continuous improvement in breadth and depth. In order to achieve climate goals, the global average carbon price will remain at a high level, and China's carbon market price will rise to a level close to the international carbon market.

In the view of industry experts, under the vision of global carbon neutrality net zero emissions, carbon prices are expected to continue to increase gradually. The carbon emission trading market is a highly policy-based and regionalized market. Different countries or regions have huge differences in carbon prices due to different development stages, emission reduction efforts, quota supply and demand, distribution methods, trading mechanisms, etc.

Meet social expectations

The report shows that since the launch of national carbon emission rights trading in 2021, the overall price of carbon emission quota transactions has shown a fluctuation and upward trend. The average market transaction price in 2023 was 68.15 yuan/ton, an increase of 23.24% from the average market transaction price in 2022. In economically developed regions such as Beijing, Shenzhen, and Shanghai, carbon emission restrictions are stricter, emission reduction pressure is greater, and carbon prices are relatively high.

Qing Chen, an expert from the Institute of Finance and Audit of the State Grid Energy Research Institute, introduced that from 2014 to 2019, as all sectors of society have higher expectations for the market to play a role in carbon emission reduction and the scale of the carbon market continues to expand, the confidence of the participants in the market has increased and the overall carbon price has increased. From 2021 to 2022, the country will have a more positive attitude towards climate change and will have stricter control over carbon emissions, and carbon prices will rebound rapidly and exceed the previous highs.

Chen Mingyang, director of the Energy and Climate Change Center of Sichuan Institute of Environmental Policy Research and Planning, told the China Energy News reporter that at present, my country's carbon price is at a relatively low level, but it is basically consistent with my country's development stage, carbon emission reduction goals, and enterprise affordability. The steady rise in carbon prices is in line with overall social expectations, and is also conducive to the function of carbon market price discovery and promoting the low-carbon transformation of the whole society.

Talking about the logic that my country's carbon prices are showing a rising trend, Zhang Xiaoping, deputy director of the China Environmental Finance Law Research Center of Central University of Finance and Economics, analyzed to the China Energy News reporter that my country's carbon price rise is affected by at least two factors: First, after the "dual carbon" goal was proposed, a series of supporting measures at the central level were successively introduced, local industries followed up to form long-term and stable policy expectations, and policy expectations were transformed into market expectations, which had a significant impact on the behavior of relevant entities; Second, the difficulty of emission reduction has increased. Taking the national carbon market as an example, in the quota allocation plan in recent years, the emission benchmark values of various units have been lowered.

Wang Jun, founder of the Future of Climate and author of the Carbon Neutral Era, said in an interview with China Energy News that there are several factors that have risen in carbon prices: First, when demand is strong, if the allocation of carbon emission quota in the national carbon market tightens, most emission control companies will lack quotas, and carbon prices will naturally rise; second, the number of fulfillment of contracts used for sale in the carbon market is limited, and some companies "hidden" the quota balance in their hands and wait for the price to be sold. The important reason for the rise in carbon prices in 2023 is that the national certified voluntary emission reduction (hereinafter referred to as "CCER") will restart, and the supply of carbon trading will theoretically increase.

"Understanding the impact of rising carbon prices, in addition to the increase, we should also consider the concept of time or speed. A milder increase in growth is generally conducive to incentivizing enterprises to reduce emissions. A more rapid rise in carbon prices will have a huge impact on the costs of enterprises." Zhang Xiaoping believes that carbon prices cannot be understood as the business of enterprises. Since the production costs of enterprises will eventually be transmitted to the terminal consumption link, carbon prices can be regarded as a comprehensive reflection of the emission reduction burden of the whole society. The faster the carbon price rises, the more difficult it is to adjust and adapt to all aspects of social life. How long will my country's carbon market price level with the international carbon market? It is a question worth continuing to observe. Faster carbon price increases are more likely to occur after the carbon peak.

CCER restarts push up carbon prices

"If there is no intervention, after the first wave of voluntary emission reduction in the market is approved, the carbon price will exceed 100 yuan." "Now many companies have opened accounts." "The market will become rational in 2025." Many industry insiders said that the restart of CCER will also push up carbon prices.

"The rise in carbon prices should be viewed dialectically. A reasonable rise in carbon prices will help release the green competitiveness of the leading companies in carbon reduction and transform emission reduction advantages into economic benefits. At the same time, it will help mobilize more technology, manpower and capital factors to gather in the field of carbon emission reduction and promote the low-carbon transformation of the economy and society." Chen Mingyang said that, however, for enterprises with low energy efficiency and carbon efficiency levels, more money is needed to purchase carbon emission quotas, and the cost of clearing and fulfilling the contract will be greater. It should be pointed out that in the initial stage of the carbon market, we must prevent the rapid growth or sharp decline of carbon prices, curb investment speculation, and create good expectations and environment for the healthy and stable development of the carbon market.

In Chen Mingyang's view, as my country implements "dual control" for carbon emissions, gradually tightens the quota allocation baseline, expands the carbon market industry, establishes a paid quota allocation mechanism, and relaxes restrictions on carbon trading entities, etc., carbon prices will continue to rise. However, it is difficult to reach the carbon price level in the EU carbon trading system in the short and medium term. "It is expected that my country's carbon price level will be around 100 yuan/ton in the next few years."

Expand market participants

Zhang Xiaoping admitted to the China Energy News reporter that the national carbon market and pilot carbon market both have problems such as excessive trading concentration and insufficient trading activity. This phenomenon is largely related to the limitation of trading entities in my country's national carbon market and most pilot carbon markets as emission control units or emission control enterprises. Under this market design, transactions are concentrated around the performance period and are mainly fulfillment transactions. If market participants are expanded to other entities, market activity is expected to improve.

As the national carbon market expands, some key emission industries in the local carbon emission rights trading market will gradually withdraw from the local market and be included in the national market. But it should be noted that the national market and local market are not a complete competitive relationship, but largely complementary relationship.

"For example, the carbon markets in Beijing, Shanghai and Shenzhen have gradually been included in the construction, transportation and other fields, and have achieved expansion, and these industries are not the focus of the national carbon market at this stage." Chen Mingyang said that in addition, local carbon markets can also consider other industrial industries and lower the inclusion threshold, such as some local markets will reduce the inclusion threshold to 5,000 tons of standard coal. In addition, we must explore ways to increase the proportion of paid distribution, increase trading entities, optimize quota carryover, etc., enrich trading products and trading entities, and enhance market activity.

Improve laws, regulations, and standards

How to increase the activity of the carbon market? Chen Mingyang believes: "From the enterprise level, first, many enterprises have not yet established a carbon emission management system, with unclear base numbers, unclear goals, and lack targeting paths; second, they lack the concept of full life cycle, focusing on their own energy conservation and carbon reduction, but not enough attention to carbon reduction in the value chain, and their carbon footprint remains high; third, there is insufficient allocation of talents, systems, funds, etc., and many enterprises have not yet established carbon emission management agencies and teams, and the carbon emission management system is not sound, and capital investment is insufficient; fourth, some enterprises overemphasize the role of carbon offsetting, and do not do enough energy conservation and carbon reduction, which is suspected of "greenwashing".

In Zhang Xiaoping's view, in the process of participating in the carbon trading, relevant departments have two aspects to consider: the first is how to reduce emissions of non-key emission enterprises outside the coverage of the emission rights system; the second is that the enterprises themselves need a more scientific and personalized long-term emission reduction strategy. Enterprises need to identify the focus of emission reduction, arrange emission reduction technologies based on product life cycle evaluation, and conduct emission reduction more efficiently based on industry attributes and available resource levels.

"my country urgently needs to improve laws, regulations and policy standards for responding to climate change and carbon emission reduction, enhance the binding nature of carbon emission impact assessment, and guide and support enterprises in carbon emission reduction." Chen Mingyang said that in addition, it is also necessary to improve policy norms in green trading, power trading and carbon emission rights trading mechanism connection, carbon footprint accounting, etc.