There is a great chance that emissions of Chinese factories will decrease due to the introduction of an Emissions Trading System. Image source: Shutterstock (#129205010)
China will launch the world’s biggest Emissions Trading System (ETS) this year. ETS are commonly seen as efficient policy tools that constrain markets. Moreover, they are a cost-efficient method of reducing greenhouse gas emissions while the economic growth still succeeds. China’s ETS will be applied to an economy that accounts for half of the world’s GDP and covers more than 15 percent of the global emissions so the system will have a global significant impact. The ETS will also play an important role for China itself because the country has set some very ambitious climate goals the ETS will transition from commitment to implementation. However, implementing such an ETS is also very challenging in such a large country with its huge economy and bureaucracy.
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