The Shanghai carbon market (China) has decided to allow participants to use period surplus emission permits over the 2016-2018, in order to comply with emission targets over 2016-2018. China is preparing to start a national carbon trading scheme as of 2017 but the validity of existing permits in the seven regional pilot emission trading schemes remains unclear. The decision by the Shanghai carbon market is expected to lead regional schemes to continue to operate until at least 2018.
In 2013, the Shanghai government handed out for free 160 million emission permits per year over the 2013-2016 period (ending on 30 June 2016); local emitters covered by the city's carbon scheme will be allowed to convert their surplus permits into "Shanghai Emission Allowances" (SHEA) and to carry over 1/3 of their surplus per year over the 2016-2018 period.
The national carbon market is expected to cover companies in eight large emitting industrial sectors, emitting more than 260 ktCO2/year.
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