BEIJING, July 10 China's Tianjin has extended
the deadline for its biggest carbon producers to comply with the
city's emissions trading scheme a second time, giving companies
two more weeks to hand over permits to the government.
The delay is the latest in a string of hiccups as
governments and company officials in seven regions running
emissions schemes gather experience in carbon trading, Beijing's
favoured approach for reducing greenhouse gases.
The 114 energy and industrial firms covered by the Tianjin
market, were supposed to hand over permits to cover for their
2013 emissions on Thursday.
But the deadline has been extended to July 25, the Tianjin
Climate Exchange announced, as the government needs more time to
make final adjustments to permit allocations to companies whose
2013 emissions varied significantly from what had been expected.
Power and heat facilities were given 90 percent of their
allocated lots last year. How much of the final 10 percent they
will actually receive will be decided by their verified emission
reports for 2013.
The permits will be issued next week, and could increase
overall market supply.
Trading in the Tianjin market has increased slightly in
recent weeks, but the total volume traded since the market began
last December has only reached around 250,000 permits, of around
160 million permits that could be offered, indicating that
demand is low.
The price rose to its highest level in March, when permits
traded at 50 yuan ($8.07), but has since fallen to around half
"Tianjin gave out permits to manufacturers based on
historical emission levels," said one expert involved in the
allocation process who wished to remain anonymous.
"The government has no plan to take back surplus permits
unless they have closed down their business," the expert added.
Observers have proposed the government tightens the cap for
2014 to incentivise emission cuts, but the government has yet to
announce how many permits will be handed out for this year.
Trading of 2014 permits will start on July 28, the Tianjin
Climate Exchange said Thursday.
The extension follows delays elsewhere in the country.
The compliance date for the Beijing scheme was June 27, but
the municipal government has yet to release any data. However,
market sources say some 50 companies have yet to hand over
permits to the authorities.
In Shenzhen, four companies missed a July 1 deadline, but
according to news provider Crystal Carbon, three of those have
now bought the permits they needed to meet their targets.
Guangdong province has extended its deadline to July 15. The
local government has announced that by July 8, 69 percent of
scheme participants had surrendered permits.
Shanghai is the only region where compliance has gone
according to plan, with all emitters meeting the June 30
(Reporting By Kathy Chen and Stian Reklev; Editing by Joseph