On November 20th, 2021, cohosted by the Global Institute of Financial Professionals (GIFP Institute) and the Quantitative Finance Committee of China Market Association (Quantitative Finance Committee for short), the series of "Carbon Finance" theme seminars jointly supported by Jiao Tong University Education Group, Rigg Zhiyan, Golden Future Education and Diankuan Technology were held online and offline simultaneously as scheduled. This event attracted CFRM, AQF, AFV, RFP certificants and candidates, as well as practitioners of financial industry who are interested in green finance.
Since the first performance cycle of the Chinese national carbon market power generation industry was officially launched in 2021, the national carbon trading market is gradually developing, and some local governments and financial institutions have explored and innovated plenty of carbon financial products, such as pledge loans of carbon emission quotas in Hebei, Shandong, and the banking industry has also actively laid out carbon financial products such as carbon neutral bonds and carbon structured deposits. Carbon financial services and products are entering the "fast lane" of development. Looking at the blueprint of China's 100 billion carbon trading market, the blue ocean of China and global’s carbon derivatives financial markets, carbon neutral markets, and carbon financial products and derivatives tools such as carbon forward, carbon swaps, carbon options, carbon leasing and carbon asset securitization, will be developed in an orderly manner in the future. Enterprises, institutions, and individuals will all need to explore, study and recognize this new trend.
Dr. Ji, the academic head of carbon finance, Rigg Zhiyan delivered the speech " Carbon financial system construction: Now and the future" in the seminar. Dr. Ji introduced the origin of carbon finance and carbon market from the changes in international climate policies and two significant international conventions: United Nations Framework Conventionon Climate Change and Kyoto Protocol. Taking the highly developed EU carbon market as an example, he introduced the futures, forwards, options and swaps of EUA, CER and ERU in details, and the trading forms of carbon futures. It provides a reference direction for the future advancement of China's carbon market.
Dr. Ji mentioned that although the spot trading volume of China's carbon quota ranks first among the world's major carbon markets, it only covers the power industry right now, and the future industry coverage scale and development prospects are extremely broad. As of November 16th, 2021, the national carbon market has been in operation for 80 trading days, with a cumulative turnover of 27.03 million tons of carbon emission quota and a cumulative value of 1.193 billion RMB. The spot trading volume of China's carbon quota is 4 times that of EU carbon market and 18 times that of South Korea market, ranking first in the world. At present, China's carbon market only covers 2,126 enterprises in the power industry, and it will be gradually incorporating other key emission industries such as steel, cement and electrolytic aluminum in the near future.
Dr. Ji commented that China is expected to become the carbon market with the largest market value and turnover in the world, and the seven investment fields of China's zero-carbon transformation will usher in huge market scale and benefits. At present, China's carbon trading price is within the range of 40-50 RMB, and there is huge room for growth compared with the price in EU of 60 euros/ton.
At the end of this event, relevant practitioners from various institutions in the industry actively discussed with Dr. Ji about the related issues of the carbon finance they met in this event and their daily work. Participants indicated that this kind of event was not only a feast of knowledge, but also a wonderful platform to gain insights and expand connections.
This forum, as a continuing education program for CFRM, AQF, AFV and RFP certificants, lasted for nearly two hours. It is believed that all certificants and candidates have a deeper understanding of carbon neutrality, peak carbon dioxide emissions, carbon finance and carbon trading in China's current economic development phase. We will bring more high-quality and rich continuous education programs in the future.
Look forward to seeing you next time!
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