Greater Bay Area: region set to drive efforts toward China’s net-zero goal as carbon exchange thrives

The Greater Bay Area offers various scenarios for carbon reduction amid its higher carbon emissions compared with major bay areas in the world, expert said

How to adapt the goal to serve supply chains, enhance cooperation among different industries to avoid repetitive efforts are some key issues to be tackled

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The central business district of Guangzhou, the capital of southern Guangdong province. Photo: EPA-EFE

Published: 10:30am, 19 Aug 2022

The Greater Bay Area is well positioned to lead carbon reduction efforts in China, as the government mulls the details of a carbon emissions exchange planned for the vast economic zone, industry experts said.

The room for improvement is large considering the proportion of coal in the overall energy mix in the bay area is around 30 per cent, said Meng Meng, general manager at the Guangzhou-based China Emissions Exchange (CEEX). That compares with about 20 per cent or lower in key bay areas in the US and Japan.

“The overall green development of the Greater Bay Area will face a complex situation” due to different social and tax systems in mainland China, Hong Kong and Macau, said Meng at the Synergise GBA Forum on Thursday. This complexity, however, will bring more opportunities for enhancing green finance, she added.

CEEX was set up in 2012 by Guangzhou Exchange Group and is the designated platform for the issuance and trading of carbon emissions allowances and credits. As one of seven regional pilot carbon emissions trading markets, CEEX recorded 27.5 million tonnes of allowance trading in 2021, ahead of its six peers.

Experts at the forum – from Hong Kong and the mainland – foresee a lot of potential in the development of the green finance sector in the 11-city economic region. They believe it can be used in local supply chains, because the Guangdong province is a major manufacturing hub in the country.

The government of Guangzhou is studying the details of a carbon emissions exchange planned for the area that encompasses Hong Kong, Macau and nine cities in the southern province of Guangdong. The exchange could help China achieve its goal of reaching peak carbon emissions by 2030 and carbon neutrality by 2060.