"Carbon markets are a critical tool to reduce carbon emissions by making emissions reductions available at the most efficient price." Some experts believe that countries should strike bilateral deals and form coalitions to trade carbon credits in an international carbon market ‘club’. China’s emissions trading system was launched in July 2021, which is set to be the largest carbon market in the world. Carbon markets will be a key point of discussion at the international climate conference COP26, to help solve the climate crisis. In the absence of a global carbon trading mechanism, countries should strike bilateral deals and form coalitions to trade carbon credits across borders. After many years of pilots, China’s much awaited emissions trading system was launched in early July. This will be the largest carbon market in the world, covering initially over 2,000 companies in the power generation sector that emit over 4 billion metric tons of carbon dioxide a year. Globally, only 21 percent of emissions are covered by carbon pricing systems. This needs to increase significantly if we want to reach our 1.5 C temperature goal. The new Chinese emissions trading system increases the emissions covered by carbon prices globally by 6 percent […]

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