EnhancingChina’sETSforCarbonNeutrality:IntroducingAuctioningLessonsfrominternationalexperienceTheIEAexaminesthefullspectrumofenergyissuesincludingoil,gasandcoalsupplyanddemand,renewableenergytechnologies,electricitymarkets,energyefficiency,accesstoenergy,demandsidemanagementandmuchmore.Throughitswork,theIEAadvocatespoliciesthatwillenhancethereliability,affordabilityandsustainabilityofenergyinits31membercountries,13associationcountriesandbeyond.Thispublicationandanymapincludedhereinarewithoutprejudicetothestatusoforsovereigntyoveranyterritory,tothedelimitationofinternationalfrontiersandboundariesandtothenameofanyterritory,cityorarea.Source:IEA.InternationalEnergyAgencyWebsite:www.iea.orgIEAmembercountries:AustraliaAustriaBelgiumCanadaCzechRepublicDenmarkEstoniaFinlandFranceGermanyGreeceHungaryIrelandItalyJapanKoreaLithuaniaLuxembourgMexicoNetherlandsNewZealandNorwayPolandPortugalSlovakRepublicSpainSwedenSwitzerlandRepublicofTürkiyeUnitedKingdomUnitedStatesTheEuropeanCommissionalsoparticipatesintheworkoftheIEAIEAassociationcountries:ArgentinaBrazilChinaEgyptIndiaIndonesiaKenyaMoroccoSenegalSingaporeSouthAfricaThailandUkraineINTERNATIONALENERGYAGENCYEnhancingChina'sETSforCarbonNeutrality:AbstractIntroducingAuctioningPAGE|3IEA.CCBY4.0.AbstractThepaceofemissionsreductionsofthePeople’sRepublicofChina(“China”hereafter)overthecomingdecadeswillbeanimportantfactoringlobalcommoneffortstolimitglobalwarminginlinewiththeParisAgreement.China’snationalemissionstradingsystem(ETS)cameintooperationinJuly2021,andisanimportantpolicyinstrumentforachievingitsstatedclimateambitionofpeakingCO2emissionsbefore2030andachievingcarbonneutralitybefore2060.Thisreport,EnhancingChina’sETSforCarbonNeutrality:IntroducingAuctioning–Lessonsfrominternationalexperience,respondstotheChinesegovernment’sinvitationtotheIEAtoco-operateoncarbonemissionstradingsystems.ItshowshowintroducingauctioningcouldstrengthenitsnationalETSandhelpChinaacceleratethecleanenergytransitionandadvancetowardsitsclimateambitions.DrawingoninternationalexperiencesonimplementingallowanceauctioninginETSsystems,thisreportexplorespolicyaimsandoutcomes,keydesignandimplementationelements,andtheuseofauctionrevenues.ItaimstoinformpolicymakersinChinaandotherjurisdictionsconsideringincludingallowanceauctioningintheirETSdesignordevelopment.ItincludesaseriesofpolicyinsightstailoredtoChina’snationalcircumstancestoinformthedomesticpolicymakingprocess.EnhancingChina'sETSforCarbonNeutrality:IntroducingAuctioningAcknowledgements,contributorsandcreditsPAGE|4IEA.CCBY4.0.Acknowledgements,contributorsandcreditsEnhancingChina’sETSforCarbonNeutrality:IntroducingAuctioning–LessonsfrominternationalexperienceisareportpreparedbytheEnergyandEnvironmentDivision(EED)oftheInternationalEnergyAgency(IEA).DavidFischer,ProjectCoordinatorandClimatePolicyAnalyst,ledandco-ordinatedthepublication.ThemainauthorsofthereportwereDavidFischer,XiushanChenandInsaHandschuchfromtheIEA.DaZhang,HongyuZhang,RunxinYuandXiliangZhangofTsinghuaUniversity’sInstituteofEnergy,EnvironmentandEconomyprovidedvaluableinputandfeedback.SaraMoarifandTomHowes(formerIEA)providedvaluablefeedback,supportandoverallguidancetotheproject.Thereportalsobenefitedfromaclosed-doorworkshopjointlyorganisedbytheIEAandTsinghuaUniversity.ThanksgotoFengLiu(China’sMinistryofEcologyandEnvironment),XiliangZhang...