First Financial Research Institute Carbon Market Monthly Report: Work plan for the national carbon market in 2026 announced, progress on research and promotion of carbon futures | Carbon Watch

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Summary

In February, the national carbon market liquidity significantly declined, mainly due to the Spring Festival holiday and the off-season after compliance periods. The Ministry of Ecology and Environment issued the “Notice on Doing a Good Job in the 2026 National Carbon Emission Rights Trading Market,” clarifying requirements for key emission units in industries such as power generation, steel, cement, and aluminum smelting. The convening of the Two Sessions sent positive policy signals, and the expansion of the carbon market may proceed with broader scope.

Regional carbon markets still show notable differences in volume and price. In February, trading in several local markets like Beijing, Tianjin, and Chongqing was inactive. Shanghai’s carbon market had the highest trading volume, with an average transaction price of 60.15 yuan/ton. Chongqing and Hubei announced their key emission unit lists for 2025. Guangdong issued a document supporting the Guangzhou Futures Exchange to promote the development of a carbon emission rights futures market and to explore related futures products, which could provide companies with tools for price risk management.

Main Text

I. National Carbon Market

1. Overview of the National Carbon Market and Voluntary Greenhouse Gas Reduction Market Trading

In February, total trading volume of carbon emission allowances (CEA) was 3.4868 million tons, with a total transaction value of 267 million yuan. Protocol-based trading accounted for 486,800 tons with a value of 38.73 million yuan. Block protocol trading reached 3 million tons, valued at 229 million yuan. No one-way bidding occurred in February. The highest CEA price was 82.00 yuan/ton, and the lowest was 74.00 yuan/ton. The closing price on the last trading day of February increased by 1.90% compared to January’s last trading day. Since market opening on February 28, 2026, cumulative CEA trading volume has reached 879 million tons, with a total transaction value of 58.725 billion yuan.

The total voluntary emission reduction volume (CCER) traded in February was 347,200 tons, with a transaction value of 29.6993 million yuan, and an average price of 85.53 yuan/ton. On the last trading day of February, the average price was 87.22 yuan/ton, up 3.83% from 84.00 yuan/ton on the last trading day of January. Since market opening, cumulative CCER trading volume has reached 10.6238 million tons, with a total value of 75.9 million yuan.

2. National Low-Carbon Policy Documents

The 2026 national carbon market work requirements are now clear: On February 9, the Ministry of Ecology and Environment issued the “Notice on Doing a Good Job in the 2026 National Carbon Emission Rights Trading Market,” specifying key tasks such as developing the list of key emission units in industries like power, steel, cement, and aluminum, data quality management, allowance allocation and reconciliation, as well as greenhouse gas emission management for other key industries.

3. Market Dynamics and Trends

In February, both trading volume and transaction value of the national carbon market (CEA) dropped sharply—by approximately 68% and 66% month-on-month, respectively. Early in the month, carbon prices hovered around 80 yuan/ton, dipping slightly to a low of 76.14 yuan/ton on February 6, but rebounded to 80.56 yuan/ton by February 9, ending the month at 80.50 yuan/ton. The decline was influenced by the Spring Festival holiday and the off-season after compliance periods, leading to reduced market activity and liquidity.

The Two Sessions’ convening sent positive policy signals. The 2026 government work report explicitly states, “Actively and steadily promote peak carbon emissions and carbon neutrality, implement dual control of total emissions and intensity, improve carbon emission statistics, accounting, and carbon footprint management systems, and further expand the coverage of the carbon emission rights trading market.”

The wording in the government work report shifted from last year’s “expand the industry coverage of the national carbon emission rights trading market” to “further expand the coverage.” This indicates that the market expansion will proceed with broader scope, including more industries and comprehensive upgrades in regulation boundaries, accounting standards, trading mechanisms, and constraints.

II. Local Carbon Markets

1. Local Market Trading Overview

(1) Beijing Carbon Market

In February, there was no trading activity in Beijing’s carbon emission allowances (BEA).

(2) Shanghai Carbon Market

In February, Shanghai’s carbon market had a trading volume of 202,200 tons, with a transaction value of 12.16 million yuan, and an average price of 60.15 yuan/ton. On the last trading day, the average price was 63.90 yuan/ton, up 10.36% from 57.90 yuan/ton on the last trading day of January. Since market launch, cumulative trading volume reached 58.86 million tons, with a total transaction value of 1.968 billion yuan.

(3) Guangdong Carbon Market

In February, Guangdong’s carbon allowances (GDEA) traded 29,789 tons, with a value of 1.1632 million yuan. The highest price was 48.88 yuan/ton, and the lowest was 38.01 yuan/ton, with an average of 39.05 yuan/ton. On the last trading day, the closing price was 38.56 yuan/ton, down 1.41% from 39.11 yuan/ton in January. Since market opening, cumulative trading volume has reached 233 million tons, with a total value of 6.786 billion yuan.

(4) Shenzhen Carbon Market

In February, Shenzhen’s carbon allowances (SZEA) traded 3,501 tons, with a transaction value of 147,000 yuan. The highest price was 42.00 yuan/ton, the lowest was 40.00 yuan/ton, and the average was 42.00 yuan/ton. The last trading day closing price was 42.00 yuan/ton, up 5.26% from 39.90 yuan/ton in January. Since market launch, cumulative trading volume has reached 80.0139 million tons, with a total transaction value of 2.180 billion yuan.

(5) Hubei Carbon Market

In February, Hubei’s carbon allowances (HBEA) traded 20,589 tons, with a value of 716,900 yuan. The highest price was 38.68 yuan/ton, the lowest was 33.00 yuan/ton, with an average of 34.82 yuan/ton. On the last trading day, the closing price was 36.70 yuan/ton, up 4.65% from 35.07 yuan/ton in January. Since market opening, cumulative trading volume has reached 424 million tons, with a total value of 10.526 billion yuan.

(6) Tianjin Carbon Market

In February, Tianjin’s carbon allowances (TJEA) had no trading activity.

(7) Chongqing Carbon Market

In February, Chongqing’s carbon allowances (CQEA) had no trading activity.

(8) Fujian Carbon Market

In February, Fujian’s carbon allowances (FJEA) traded 29,414 tons, with a value of 823,500 yuan. The last trading day closing price was 23.00 yuan/ton, down 17.86% from 28.00 yuan/ton in January.

2. Local Policy Documents on Low-Carbon Development

Guangdong supports research on carbon futures: On February 2, the Guangdong Development and Reform Commission issued the “Work Plan for Optimizing a First-Class Market Environment in 2026,” proposing to promote the construction of the carbon emission rights trading market, support the Guangzhou Futures Exchange to develop a carbon emission rights futures market, and explore related futures products.

Chongqing announced its 2025 key emission unit list: On February 14, the Chongqing Ecology and Environment Bureau published the “2025 Key Greenhouse Gas Emission Units List for Chongqing Carbon Market,” including 379 units.

Hubei published its 2025 key emission unit list: On February 26, the Hubei Ecology and Environment Department announced the “2025 Key Emission Units List and Reporting List for Hubei Pilot Carbon Market,” including 567 units.

Guangdong released its 2025 allowance distribution plan: On February 26, the Guangdong Ecology and Environment Department issued the “2025 Carbon Emission Allowance Distribution Plan,” covering eight industries—petrochemical, paper-making, civil aviation, ceramics, transportation (ports), data centers, steel, and cement—with 288 regulated companies and 10 new projects.

3. Market Dynamics and Trends

In February, due to the Spring Festival holiday, overall activity in local markets declined, with trading volume and value decreasing by approximately 37% and 29% month-on-month.

Regional differences in volume and price remain prominent. Several markets like Beijing, Tianjin, and Chongqing saw no activity. Shanghai’s market led in volume and had the highest average price at 60.15 yuan/ton; Fujian’s market had the lowest average price at 28 yuan/ton.

Guangdong’s support for the development of a carbon futures market aims to enhance market liquidity, provide risk management tools for companies, and strengthen China’s voice in international carbon markets.

(Source of the main image: Oriental IC)

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Author | Liu Huiwen, Researcher at Yicai Research Institute

Contact us | yicairi@yicai.com

(This article is from Yicai)