On 19 October 2023, the PRC Ministry of Ecology and Environment (MEE), with the State Administration for Market Regulation (SAMR), issued “Measures for the management of voluntary emission reduction trading of greenhouse gases (Trial).”
These new measures represent a significant step toward the relaunch of China’s certified emission reduction (CCER) program after a nearly 7-year suspension. The new CCER program will offer compliance entities under China’s national and regional emission trading systems (ETSs) additional flexibility in meeting their emission reduction compliance obligations. and at the same time, provide additional source of revenue for projects that can reduce or avoid GHG emissions.
National registry and trading venue
Under the new measures, approved/registered CCER projects and emission-reduction credits generated from such projects will be registered and deregistered through a national CCER registry. Pending an official national trading venue to be determined, Beijing Green Exchange is designated to provide trading and settlement services for CCER program.
Participants in CCER trading are currently limited to compliance entities under Chinese national and regional ETSs, CCER project owners and other entities established in China. The cross-border trading or use of CCERs will be regulated under separate rules to be issued by the MEE.
Requirements for emission-reduction projects
A project may be registered as a CCER project if the following requirements are met:
- It is conducive to reducing carbon emissions and increasing sinks, and can avoid or reduce greenhouse gas emissions, or achieve the removal of greenhouse gases;
- It is authentic, has no “double-counting” issue, and has additionality in emission reduction or removal compared with the baseline emission specified in the applicable methodologies;
- It is in-the-field supported by project methodologies published by MEE (the first batch of methodologies was published on 24 October, and included afforestation carbon sink, grid-connected photothermal power generation, grid-connected offshore wind generation and mangrove creation); and
- Construction started on 8 November 2012 or later.
Certification and verification entities
Registration of CCER projects and CCERs generated from such projects must be certified and verified by qualified certification and verification entities approved by the SAMR. It is not clear whether certification and verification entities previously qualified will be recognized by SAMR under the new CCER measures.
With the new CCER measures and subsidiary rules in effect starting 19 October, it is widely expected that the CCER program will officially start operating soon.