Emission Trading For China : the inspiration from the European Union Emissions Trading Scheme

How to avoid and deal with dangerous climate change, which will have catastrophic economic and social consequences, has already become the focus worldwide. From the UNFCCC to the UN Climate Change Conference in Copenhagen, the international community has been trying to find effective means to reduce GHGs. Facing both internal demand and external pressure, as the largest carbon dioxide emitter, China needs to make further efforts to reduce CO2 emissions. So far, emission trading, especially the EU ETS has proved to be a good system to reduce emissions with low cost. In this thesis, the valuable experience and lessons of the EU ETS and the current situation of China are reviewed. The necessity, feasibility and limitations of applying the EU ETS in China are analyzed through comparative study and SWOT – PEST analytical model. In the light of the analysis result that establishing its own emission trading scheme based on the EU ETS will be a good choice for China, several recommendations are put forward concerning both the process of the “Sino ETS” and various stakeholders