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The appropriate design of the emission trading scheme (ETS) plays a crucial role in promoting companies to conduct low-carbon technological innovations. Based on a questionnaire survey, this paper examines how the design of the ETS and identified determinants have impacted corporate low-carbon technological investment decisions. The data was collected from 99 companies in the eight areas that are implementing the ETS in China. The results indicate that five attributes significantly influence the possibility of corporate investments in low-carbon technologies and thus need more attention in designing the national ETS, including allowance allocation for existing installations, compliance period, allowance allocation for new entrants, allowance banking and policy stability. From the viewpoint of the surveyed companies, the ETS that allocates allowances for existing installations based on the benchmark, has a long compliance period, allocates allowances for new entrants based on a uniform benchmark and allows companies to bank allowances could effectively encourage companies to conduct the low-carbon technological investment. The results of this study are important in light of ongoing discussions and developments of the national ETS in China. [Display omitted] • This paper examines the innovation influencing mechanism of ETS design features and other determinants. • Data were collected from 99 companies in the eight areas that are implementing ETS in China. • The policy attributes significantly associated with corporate low-carbon technology investment decisions are identified. • We also identify the determinants that are closely related with low-carbon technology investment decisions. • Policy implications for designing the national ETS are provided. [ABSTRACT FROM AUTHOR]

It is crucial to understand corporate preferences in designing and planning new market-based instruments. Using the method of conjoint analysis, this paper evaluates corporate preferences for policy alternatives of the sectoral crediting mechanism aiming at supporting its discussions and development. Data were collected from 94 companies in all 11 prefecture-level cities of Shanxi province, China. The results confirm that companies are most concerned about three policy attributes; domestic policy instruments, the relationship with the clean developing mechanism, and the principle of Common but Differentiated Responsibilities. From the viewpoint of the Chinese businesses surveyed, the ideal policy alternative has a domestic policy instrument in which installations with voluntary targets receive tradable units, while co-existing with the clean developing mechanism, and providing opportunities to get financial and technical assistance from developed countries. Meanwhile, the coverage of the sectoral crediting mechanism could be expanded to small companies that are the most inefficient and thus have the lowest abatement costs in some sectors. The results of this study are important in light of ongoing discussions and developments of the sectoral crediting mechanism in China. [ABSTRACT FROM AUTHOR]