How China turned an interest in emissions trading into a cutting-edge tool against climate change
The carbon market concept is complicated, but China has learned it thoroughly, leaping into a mechanism that, ironically, was invented in the US, Paula DiPerna writes
I could not resist taking the photo. “Green Finance Street Tunnel”, said the road sign in a new area of the southern Chinese city of Guangzhou. “Is there any other such tunnel name in the world?” I had to wonder. “What a marquee!”
Nearby, three gleaming new buildings called the Green Finance Centre, dedicated to research and innovation, dominated the area. And inside one was the home of the young but sophisticated China Emissions Exchange, where I was headed to join a panel to discuss green finance advancement and carbon trading.
I was coming a bit full circle. Just about 10 years ago, I had flown across the Pacific to be in China on August 8, 2008 – also the day of the opening of the Beijing Olympics – at the opening day of one of my “children”, the first of China’s pilot carbon markets, the Tianjin Climate Exchange (TCX).
That day had also been thrilling, as scores of dignitaries and I shared celebratory remarks on the milestone we had achieved.
Led by my colleague, the renowned economist Richard Sandor, China National Petroleum Corp and the city of Tianjin, I had helped spearhead our first-of-its-kind joint venture to create TCX, an affiliated exchange with our Chicago Climate Exchange (CCX), the world’s first and only integrated cap-and-trade for all six gases.