Evaluation of the Pricing of Pollutant Emissions Allowance in Zhejiang Province, China

Over the past few decades, the pollutant emissions trading policies in China have undergone significant innovation and exploration. It is considered a market-based approach integrated with command-and-control mechanisms such as total emissions control or pollutant emissions allowance. This study is the first to provide systematic, reflective thinking that examines China's regional initiatives of pollutant emissions trading systems. In this article, we took research on the representative province, Zhejiang, as our case study to analyze the impact of the pricing of pollutant emissions allowance on enterprises’ trading behavior, in which the pollutant objects are mainly selected to focus on chemical oxygen demand (COD), ammonia nitrogen (NH3-N), sulfur dioxide (SO2), and nitrogen oxides (NOX). This paper used a quantitative approach by drawing the error lines of allowance auction and transfers among ten cities in Zhejiang Province from 2020 to 2022; then, we provided policy recommendations by exploring the positive and efficient relationship between emissions trading policies and the price of pollutant emissions allowances.