On May 29th, the General Office of the Central Committee and the General Office of the State Council issued the “Opinions on Improving the Market-based Allocation System of Resources and Environmental Elements” (hereinafter referred to as the “Opinions”), deepening the reform of the market-based allocation of resources and environmental elements.
The “Opinion” states that by 2027, the trading systems for carbon emissions and water usage will be basically completed, the trading system for pollutant emissions will be established and improved, the market mechanism for energy conservation will be further enhanced, the trading markets for resources and environmental factors will be more active, and the price formation mechanism will be more sound. This will promote the smooth flow and efficient allocation of resources and environmental factors, fully unleash market potential, and effectively enhance the supporting role in achieving relevant resource and environmental goals.
Improving the market-based allocation system for resources and environmental factors, and promoting the market-based transactions of carbon emission rights, water usage rights, and pollution discharge rights, is a key measure to enhance the utilization efficiency of resources and environmental factors.
The “market-based allocation system for resource and environmental elements” has not appeared for the first time in policy documents. The report of the 20th National Congress of the Communist Party of China stated that “a market-based allocation system for resource and environmental elements should be improved”. In 2024, the Central Committee of the Communist Party of China and the State Council released the “Opinions on Comprehensively Promoting the Construction of Beautiful China”, clearly stating that to improve the market-based allocation system for resource and environmental elements, carbon emission rights, energy use rights, water use rights, and pollution discharge rights, among others, should be included in the overall plan for the reform of the market-based allocation of elements.
Ma Jun, the director of the Institute of Public and Environmental Affairs (IPE) and the founder of Blue Map, once told 21st Century Business Herald that land, water resources, mineral resources, etc., are all resource elements, while emission rights related to the carrying capacity of the atmospheric environment, water environment, and climate stability can be regarded as environmental elements.
The “Opinion” further elaborates on how to improve the “market-based allocation system for resource and environmental elements”, focusing on detailed planning of the system from aspects such as the quota allocation system, transaction scope, and transaction system.
How to promote the basic improvement of the carbon emission rights trading system? The “Opinions” propose to strengthen the connection between carbon emission rights trading and the dual control system of carbon emissions, and promote the gradual transition of the national carbon emission rights trading market from intensity control to quota total control. Optimize the carbon emission quota allocation plan, steadily implement a combination of free and paid allocation methods, and orderly increase the proportion of paid allocation. Gradually expand the industry coverage of the national carbon emission rights trading market, expand the trading entities, and enrich the trading varieties and trading methods.
Regarding the construction of the water usage rights trading system, the “Opinions” clearly state that strict control over both the total amount and intensity of water usage should be implemented, and that the systems of water usage rights trading, river water allocation, water resource scheduling, water intake permit management, planned water usage management, and water usage supervision should be coordinated. The initial allocation system of water usage rights should be improved, and regional water rights, water intake rights, and water rights of irrigation users should be clarified. Exploratory and standardized efforts should be made to promote water usage rights trading across provincial administrative regions in key river basins such as the Yellow River.
Pollution discharge rights, as a component of resource and environmental elements, have gradually developed into an important means of environmental management through years of research and practice. The “Opinions” propose to strengthen the connection between pollution discharge rights and other systems such as pollutant discharge permits, and promote the establishment of a pollution discharge rights trading system based on pollutant discharge permits as the title of rights confirmation and regulatory carrier. It also promotes the implementation of paid allocation of initial pollution discharge rights for key pollutants in fields such as air and water. Based on provincial administrative regions, establish and improve the paid use.
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