Design Of Emissions Trading System And Evaluation Of Policy Implementation In Shanxi Province

Emissions trading system by clear property rights,establish a market for the optimal allocation of environmental capacity resources,compared with the traditional command-and-control policies,it is more efficient.Shanxi province is one of the 11 listed pilot provinces,which carried out the emissions trading pilot work earlier.The author have did a study on the design and policy implementation of emissions trading in Shanxi province,aiming to make proposals for emissions trading pilot.Firstly,researches on the domestic and international emission trading literatures and cases were did,practical experience in domestic and international emission trading cases and problems in internal pilots were concluded,then the economics theory of emissions trading were summarized,and the basis of regimes and key links of emissions trading were came up with in this paper.The market price mechanism was concluded that emissions trading market is created by government,government can adjust the quantity of allowable pollution loads for macro-economic control;perfectly competitive markets are the most efficient,but generally emissions trading markets are affected by some factors such as transaction costs and market power.Next,the informations of history,basis,related policies and implementation of emissions trading in Shanxi province’s are summarized.Based on these informations,Shanxi provincial emissions trading system was designed and a framework of emissions trading system was established.Shanxi provincial emissions trading system consists of three elements:(1)design of emissions trading system framework,(2)emissions trading system design and construction,and(3)benchmark price and tradable emission rights trading market price system design.The author use the general model of environmental policy analysis and evaluation methods to analyze the objectives,policy framework,stakeholder responsibilities and management mechanisms about the cap and trade policy in Shanxi province.The evaluation criteria were established to evaluate policy implementation and the functioning of the market.The results indicates that:(1)in policy support aspects,national level legal regulations are missing,existing policy on violations of punishment intensity is insufficient,policies exists coordinating problems,pilots policies are not authoritative and systemic insufficient;(2)in stakeholders’ responsibility aspects,management sectors and enterprises can fulfill the responsibility of themselves,emission trading center is conducive to market management and reduce trading costs;(3)in management mechanism aspects,information mechanism is more comprehensive,financial revenue and expenditure in accordance with the principles of environmental finance system,verification and punishment mechanisms are weak which unable to fully meet the demand of emission trading,and(4)in terms of market efficiency and fairness,the main distribution of permits in primary market is free,the transaction in secondary market mainly based on agreements between companies,it is difficult to guarantee efficiency and fairness of the market.For above these assessment results,the following suggestions are made:(1)the local policies of emission trading in Shanxi province should be gradually improved,the coordination with other policies should be strengthened,local legals revision should be accelerated,and punishment on illegal enterprises should be strengthened;(2)after the market gradually mature,persons and NGOs should be allowed to enter emissions trading market;(3)information publication should be strengthened within the framework of information disclosure system to further guarantee the public’s right to know and to supervise;(4)the number of free allocation should be reduced and the number of adopting the methods of pricing sales and public auctions should be increased,while the secondary market auction method should be improved.Last,according to the needs of trading market in Shanxi province at this stage,the first-price sealed auction model was established,through analyzing this model discovered that set lower entered threshold can attracted more enterprises to participate competitive bidding,it is useful to reflect real value of emissions permits.Secondary market auction model was established,through analyzing this model discovered that using high and low match of two-way auction mechanism,the welfare of buyers and sellers are maximum and distribution of welfare are fair.The two auctions mechanisms should be used in the further pilot scheme.