The Study On Supply Mechanism Of Carbon Emission Allowances

Creating and maintaining scarcity of emission allowances through allowances supply mechanism is essential for any carbon emissions trading system,with emissions reduction efficient and allowances market stable.By asking how to design carbon emssion allowances supply mechanism efficiently,and by means of economicis theoretical method and statistics,this paper bring up and analyze the basic composition elements of allowances supply mechanism.Main conclusions:(1)carbon emission allowances supply mechanism include emission cap setting mechanism,allowances allocation mechanism,allowances adjustment mechanism,which respectively represent the produce of allowances,allocation of allowances and reallocation of allowances;(2)To set emission reduction target and total allowances,country’s economy growth,environmental protection and international emission reduction agreement need to be considered comprehensively;(3)To keep independency and anti-interference of emissions cap setteing,lowering seeking rent,emissions cap need to be set by legislative bodies,with ratchet mechanism autoadjust supply of allowances in carbon market;(4)Auction is the most cost-efficient allocation method,wich can avoid complexity and administrated cost of free allocation,and windfall profits’ s distortion to emission trading system;(5)Allocances adjustment mechanism,as of importance reallocation mechanism,significantly matters for stabilization of allowances price,adaption to market and polices,and compliance of allowances.And allowances can be adjusted from both supply-side and demand-side.Setting appropriate allowances surplus is the key issue of supply adjustment mechanism.On the theoretical basis,with study of intertional and domestic ETS practice,China’s emission allowances supply mechanism should build up through four phases.Meanwhile,take the year of 2030,the estimated year of China’s emissions peak,as dividing points.Before that,allowances mainly allocate for free,and gradually transit to auction allocation,with progressively flexible mechanism;after that,allowances mainly allocate by auction,with sound and thorough flexible mechanism.