Market mechanisms to reduce transport emissions in China

Network meeting hosted by AHK Greater China Beijing

June 2019 – The network meeting held on June 27 with some 30 attendees was hosted on behalf of the German Federal Ministry for the Environment, Nature Conservation and Nuclear Safety (BMU). Topics discussed included the current status of low-carbon mobility in China and the economic and political conditions needed to promote it.

Dr. Ou Xunmin from Tsinghua University gave a talk on the potential for and approaches for use in reducing emissions in China’s transport sector. Fuel demand and carbon emissions from vehicles will further increase in the period 2015 to 2030, he said, adding that to prevent a rapid rise in emissions, policy measures must be introduced for the transport sector and should primarily focus on promoting new energy vehicles (NEVs). According to Dr. Ou Xunmin, from 2050 onwards, NEVs should account for the main share of vehicles on China’s streets.

The second expert, Lyu Wang from the China Automotive Technology & Research Center (CATARC), gave insights into the policy design and effectiveness of the new dual credit system. The credit system, which gives one credit for corporate average fuel consumption (CAFC) and one for NEV credits received, is based on the principle of supply and demand, and requires vehicle manufacturers to provide proof that they possess a certain number of credits. Manufacturers that fail to achieve their required quotas must purchase credits via the market. The system is also designed to replace the bonus scheme for NEV purchases which expires in 2020.

Further Information

A detailed report on the networking meeting is contained in the June issue of Econet Monitor, a magazine published by AHK Greater China in Beijing. The article can be downloaded here.

Note: This publication is only available in German.