Lessons from Regulating Carbon Offset Markets

Arup, Christopher; Zhang, Hao

doi:10.1017/s2047102514000272

Cited by 23 publications

(2 citation statements)

References 34 publications

(14 reference statements)

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“…Firstly, it is widely acknowledged in the literature that successful CER projects must have financial viability and sustainability in their business models [61][62][63][64]. To support this view, we conducted a simulation analysis by changing the initial conditions and construction cost parameters.…”

Section: Discussionmentioning

confidence: 99%

Dynamic Analysis and Simulation of the Feasibility and Stability of Innovative Carbon Emission Reduction Projects Entering the Carbon-Trading Market

et al. 2023

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Designing green agricultural production projects as CER projects is attractive, as it can play a role in promoting the spread of green production technologies and reducing carbon emissions based on market-based compensation. This research constructed a generic analytical framework using evolutionary game methods to evaluate the feasibility and stability of innovative CER projects by numerical analysis or simulation. Finally, two complex scenarios were analysed using simulations based on the framework. The simulation analysis results show that when the profits of VER and CER projects are close, the government’s direct intervention will lead to instability in market development, and the development of VER projects should be focused on. Government subsidies to promote the agricultural sector to participate in CER construction can be gradually reduced with the development of the market. When the reduction speed is slow enough, the effectiveness of subsidies will not be affected. The framework will be helpful to evaluate the feasibility and effectiveness of CER mechanism innovation and development, and to formulate more targeted policies to promote the popularization of green agricultural production technologies.

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Section: Discussionmentioning

confidence: 99%

Dynamic Analysis and Simulation of the Feasibility and Stability of Innovative Carbon Emission Reduction Projects Entering the Carbon-Trading Market

et al. 2023

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“…Fleischman et al (2021) suggested that more attention should be paid to the underlying political reforms regarding enforceable rights, representative and accountable institutions, clear incentives and symmetrical power relations. After exploring offsets regulation in the compliance markets of Europe, the USA and China, and the Clean Development Mechanism, Arup and Zhang (2015) emphasized a greater control of the shares, sectors, sources and standards of offsets than was initially chosen. A carbon sequestration right in the form of an easement is helpful to ensure permanence as well as enforceability and transferability of forestry offsets (Abigail, 2012).…”

Section: Introductionmentioning

confidence: 99%

Forestry offsets under China’s certificated emission reduction (CCER) for carbon neutrality: regulatory gaps and the ways forward

2024

IJCCSM

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Purpose As a typical nature-based solution to climate change, forestry carbon sinks are vital to achieving carbon neutrality in China. However, regulations in China are insufficient to promote the development of carbon offset projects in forestry. This study aims to identify the regulatory obstacles impeding the development of forestry offsets under China’s certified emission reduction (CCER) and explore ways to improve the regulatory system. Design/methodology/approach This study conducts a qualitative analysis using a normative legal research method. This study conducted a synthetic review of national and local regulatory documents to gain insights into the regulatory landscape of forestry offsets in China. The main contents and characteristics of these documents are illustrated. Furthermore, related secondary literature was reviewed to gain further insight into forestry offset regulations and to identify significant gaps in China’s CCER regulation. Findings Forestry offset regulations under the CCER are characterized by fragmentation and a relatively lower legally binding force. There is no systematic institutional arrangement for forestry offset development, impeding market expectations and increasing transaction costs. The main challenges in China’s regulation of forestry carbon sinks include entitlement ambiguity, complicated rules for registration and verification, a lack of mechanisms for incentives, risk prevention and biodiversity protection. Originality/value Forestry carbon sinks’ multiple environmental and social values necessitate their effective development and utilization. This study assessed forestry offset regulations in China and proposed corresponding institutional arrangements to improve forestry carbon sink regulations under the CCER.

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The International Dimension of the EU Emissions Trading System: Bringing the Pieces Together

Verde

Borghesi

2022

Environ Resource Econ

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We analyse the international dimension of the EU Emissions Trading System (EU ETS) over the past two decades and in the foreseeable future by reviewing facts and economic theory. The facts mainly concern the international climate change regime and the EU’s relevant experience in international cooperation. Club theory shows how incentives can be created for cooperation on climate mitigation. The linkage of the EU ETS to the Kyoto flexible mechanisms had mixed results: it promoted emissions trading abroad, but the inflow of credits into the EU ETS added to a large market surplus and the environmental integrity of certain credits was problematic. Looking ahead, the ability of the EU ETS to reduce foreign emissions may grow. Key will be whether competitiveness and distributional effects are successfully addressed. The Carbon Border Adjustment Mechanism might help the EU reduce the risk of carbon leakage while incentivising emission reductions in countries exporting to the EU. The EU’s focus on reducing domestic emissions only, suggests we will probably not see new international linkages this decade. However, it cannot be excluded that the EU will revisit its decision and relax the domestic constraint.

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Lessons from Regulating Carbon Offset Markets

Cited by 23 publications

References 34 publications

Dynamic Analysis and Simulation of the Feasibility and Stability of Innovative Carbon Emission Reduction Projects Entering the Carbon-Trading Market

Dynamic Analysis and Simulation of the Feasibility and Stability of Innovative Carbon Emission Reduction Projects Entering the Carbon-Trading Market

Forestry offsets under China’s certificated emission reduction (CCER) for carbon neutrality: regulatory gaps and the ways forward

The International Dimension of the EU Emissions Trading System: Bringing the Pieces Together

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