context: Accuracy issues for emissions data from thermal-power generation persist, despite the relative simplicity of calculating emissions from the thermal-power generation sector compared to those of China’s other energy-intensive industries. Authorities have therefore turned their attention to improving the accuracy of emissions data before they further expand the national carbon market.

Data issues have delayed new additions to the national carbon market, with new industries now not entering the market for another one to two years, per a Caijing column published on 13 May 2022 citing multiple sources.

SinoCarbon Innovation and Investment now predicts that

  • cement and electrolytic aluminium will join in 2023
  • iron and steel will join in 2024
  • petrochemicals will join in 2025
  • chemicals, paper and aviation will join after 2025

According to the article

  • of the major energy-intensive industries not yet in the carbon market, it is easiest to calculate emissions for the cement and electrolytic aluminium industries
    • new carbon accounting standards for these industries have been drafted and are taking non-public comments
  • current data quality issues stem from
    • the ambiguity of carbon emission data accounting guidelines
    • regulatory challenges in the data collection process
    • data falsification induced by a regulation mandating high carbon content values for coal when firms do not measure carbon content themselves

Lin Yuan 蔺苑 Refinitiv chief power and carbon analyst argues that

  • authorities should draw up greenhouse gas accounting methods for two to three industries in 2022 to prepare them to enter the carbon market
  • industries brought under regulation in 2023 will not enter the carbon market until 2025
  • the national carbon market should shift from controlling carbon intensity to controlling total carbon emissions

Industry insiders note that 2022 revisions to carbon accounting requirements are too idealistic, although they are generally optimistic about future data quality for thermal-power firms. They also warn against expanding the national carbon market too slowly.