Hong Kong has received permission from the central government to join an experimental pollution-control scheme on the mainland which could lead to the creation of a market for emissions trading worth at least $1 billion a year.
Secretary for Environment, Transport and Works Sarah Liao Sau-tung said she had asked environmental authorities in Beijing to widen a pilot scheme involving four provinces and three cities to include Hong Kong, Macau and Guangdong.
She told the South China Morning Post that the State Environmental Protection Administration had agreed to include the two special administrative regions and Guangdong province in the trials which already cover heavily polluted cities such as Shanghai and Tianjin. 'As our proposal on emissions trading involves the three places, I need that blessing from the state and they said they would agree,' Dr Liao said.
The move comes amid calls from influential figures for Hong Kong to consider establishing an exchange for emissions trading. They warn the SAR risks falling behind the mainland and other leading cities such as Chicago where projects and exchanges are being developed in a bid to reduce pollution.
Emissions trading schemes have come about because of the caps set on the amount of pollution which can be produced by industrial sources such as power plants or factories. Companies which produce less emissions than the permitted level are allowed to store the excess capacity for future use or trade it with other corporations which cannot meet the pollution targets set by authorities.
The mainland, which has been experimenting with pilot schemes since 1991, is viewed as a pioneer in emissions trading, according to the Asian Development Bank.
A number of small markets for trading in sulphur dioxide have been established in the United States over the past 12 years and a Chicago Climate Exchange, whose backers hope it will ultimately operate internationally, is planned for launch next year.
