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The integration or segmentation of regional carbon prices implies that barriers may hinder prices from adjusting efficiently and impede linkages between regional carbon markets. Past studies have found that crossregional carbon prices in China tend to diverge, indicating unbalanced regional markets and that carbon cap-and-trade policies may be insufficiently effective. China's carbon trading pilots opened in 2013. Is the integration efficient? This is the research question addressed in this study. This paper uses the carbon prices of four carbon-trading pilot regions in China (i.e. Beijing, Shanghai, Tianjin, and Guangdong) over the period of January 1, 2014, to March 23, 2021, to explore whether prices are correlated across three dimensions: long-term convergence, short-term correlation, and volatility transmission by adopting a vector error correction model with heterogeneous variances. And by using longer-term daily data and empirical tests that can account for the multiple-faceted correlations, this paper provides evidence showing that long-term convergence and risk transfer between the four regional carbon prices exist, which indicates significant regional integration. The results indicate that the price behavior of the Beijing pilot is efficient and that the Shanghai pilot has the lowest volatility. The paper also documents an information transfer pattern. For example, the Beijing pilot is shown to be the leading risk transfer market, whereas the Shanghai pilot is shown to be the market where most risk is transferred. Contrary to findings elsewhere, our main results demonstrate that China's carbon markets exhibit integration efficiency and no imbalance between regions. This may be because the efficiency of China's carbon markets has improved over time. The evidence also implies that if a multi-dimensional correlation has not been considered, it may underestimate the efficiency of regional carbon prices' integration. [ABSTRACT FROM AUTHOR]

This paper aims to analyze the trading mechanism of China pilot carbon emission trading market and figure out whether the current market price is rational and valid. By applying directional distance function and stochastic frontier analysis method, we estimated the CO2 marginal abatement cost of 92 coal-fueled generators belonging to 27 power plants located in Shanghai which is one of the pilot carbon emission trading market cities in China. The result indicates that the market price will greatly affect the trading activities within carbon emission trading market. We conclude that the current market price is not rational for coal-fueled power industry which is high-carbon and high CO2 MAC industry. When the exchange of nationwide carbon trading market formally start, policymakers should impose carbon tax or carbon emission quota to adjust the market price and stimulate the CO2 emission reduction willingness of coal-fueled power plants. [ABSTRACT FROM AUTHOR]

China's pilot emission trading schemes (CP-ETS) have been operating for five years since the first pilot ETS launched its carbon market in 2013. The seven pilots have a common framework but different details. In this study, an assessment model which is used to evaluate mitigation efficiency, is constructed by combining the DID method and an evaluation matrix. Results show that the five CP-ETS have been effective in promoting emission reduction, whereas the pilot ETS of Shanghai and Chongqing have failed to drive the covered enterprises to reduce their GHG emission directly. Our findings reveal that at least three key elements, namely, allowance cap, the covered enterprises' potential emission reduction capacity, and economic structure stability, affect the mitigation efficiency of the CP-ETS. The mitigation efficiency of the CP-ETS may be enhanced by conducting a pre-evaluation of the potential mitigation capacity of the covered enterprises, setting a mechanism for the evaluation and adjustment of the allowance cap, and employing financial tools to maintain the carbon price within a reasonable range that most covered enterprises can afford. [ABSTRACT FROM AUTHOR]