FRANKFURT, Oct 23 (Reuters) - The EEX European power bourse is seeking a partnership with Chinese peer CBEEX to help to develop the Chinese market for emissions trading, it said on Monday.
* A memorandum of understanding (MoU) about the intentions of both parties was signed on Oct. 20 against the backdrop of a national emissions trading system (ETS) being readied in China, EEX said in a statement.
* EEX and CBEEX plan to explore how access to Chinese emissions trading can be facilitated for international companies and vice versa, and how market participants can benefit from a broad range of trading products, it said.
* Beijing is seeking to regulate carbon dioxide (CO2) emissions from its power generators and manufacturers but has said it will struggle to meet a year-end deadline for a national scheme that will transcend seven regional pilot schemes.
* Given the size of its economy, this will have a big impact on traded markets for pollution rights worldwide.
* CBEEX vice president Zhou Cheng was quoted as saying that the Chinese CO2 market is entering a dynamic phase of development.
* “The EEX, as the leading European energy bourse, is an important strategic partner of CBEEX,” he said.
* The European Union ETS system is the biggest in the world and EEX plays a part as a host of auctions.
* EEX, which is part of Deutsche Boerse, is the EU’s common platform for carbon permit auctions.
* ETS systems work by giving manufacturers fixed emissions permits for their output, requiring they buy additional permits if they overshoot allocations. This creates incentives to step up efficiency and creates a market for certificates.
Reporting by Vera Eckert; Editing by David Goodman