London, 7 August (Argus) — Dutch consultancy Ecofys will help the Tianjin climate exchange develop a pilot emissions trading scheme (ETS) in the northeast Chinese city, with start-up planned for 2013.

Ecofys will consult on a technical assistant project, launched in May, to help the city develop its scheme. The project was commissioned by the Asia Development Bank (ADB) in support of ETS development in China, and granted $750,000 to cover technical consultancy and other expenses, Ecofys said.

As part of this project, Ecofys will help with two IT elements — the design specifications for the registry and the trading platform in Tianjin, unit manager of market-based mechanisms at Ecofys Alyssa Gilbert told Argus. Ecofys will also support the scheme designers by assisting with the policy design and an analysis of the economic impact of the ETS.

Ecofys has assembled a team of 10 to contribute expertise to the project. “Ecofys is looking forward to working closely with Tianjin to build a solid carbon market,” Gilbert said. “For us, this represents a significant and important project that will help China lead the way in building successful domestic ETS schemes.”

The Chinese government plans to launch a national carbon market by 2015 and will utilise knowledge gained from developing seven regional pilot schemes. The municipalities of Beijing, Shanghai, Shenzhen, Chongqing, Tianjin, and the provinces of Guangdong and Hubei were selected to develop the pilots. “The process of designing the Tianjin scheme will be important to the national scheme design,” Gilbert said. “The process and outcomes will help inform what happens at a national level, although work in developing a national structure will need to happen in parallel.”

The national scheme aims to help China meet its target of reducing the carbon intensity of its economy by 40-45pc below 2005 levels by 2020, Ecofys noted.

“This pilot project will offer valuable lessons for the design of a nationwide system to reduce the carbon intensity of the Chinese economy,” principal energy specialist in ADB's east Asia department Pradeep Perera said.

It has not yet been determined what sectors will be covered under the Tianjin scheme. “Tianjin has some initial ideas, but this is one area we are advising on,” Gilbert said.

The consultancy is already advising governments across three continents on the implementation of ETS schemes, Gilbert said. Ecofys is also advising on a project for the California Air Resources Board and has carried out projects for the European Commission on the EU ETS for nearly 10 years.

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