Financial Institutions’ Development Of Carbon Finance

Global climate change is drawing more and more attention from all over the worldwide. It’s generally recognized and successfully practiced using financial instruments to promote low carbon economy development. Since then, carbon finance has come into being and gradually become a bright spot in the field of international finance.The history of carbon finance can be divided into two phrases:the early exploration stage from1998to2004, and the mature stage since2005. At present, international financial institutions has initially formed three kinds of carbon finance basic patterns: carbon trading operated at allowance-based market, direct financing, and indirect financing operated at project-based market. The experience of the developing carbon finance in western developed countries has great reference significance and enlightenment to ours.Because of the support of policy and the awareness of low carbon, we has greeted a new phase in our country that carbon markets are developing rapidly, trading platforms are growing widely, financial institutions are participating in actively, and financial innovation are being carried out constantly. However, the financial institutions are restricted by internal factors such as single species of business, etc. and influenced by objective risk like market risk, etc.. Even so, the empirical study proves that the financial institutions which are the core of national economic contributed to the development of low carbon economy in our country.To better develop carbon finance, we should select a "Chinese characteristics path" with government’s guidance, financial institutions’cooperation, and supervision organizations’regulation together. Especially, the financial institutions should take part in the international carbon emissions trading market to the greatest extent, and develop new business related to low carbon projects boldly. As the carbon financial risks are inevitable, the financial institutions should monitor the carbon financial risk from all sides and control all kinds of potential risks at the same time.