China's emissions trading system (ETS) became fully operational in 2021. The program initially regulated carbon emissions from power plants, covering about 2,200 energy producers. As China's ETS ramps up deployment and decarbonization solutions, the accelerated technological progress and economies of scale will yield better performance and lower costs for consumers.

　　China's new ETS is already the world's largest carbon market, three times bigger than that of the European Union, according to a 2022 Forbes magazine report. It is predicted that China's ETS is about to grow 70 percent under plans to add heavy industry and manufacturing, making it the single largest global climate policy, covering more emissions than the rest of the world's carbon markets put together.

　　The cumulative trading volume of the national carbon emission rights market exceeded 10 billion RMB as of December 22, 2022. It has been in operation for 350 trading days since the official launch of the national carbon market. The cumulative trading volume of carbon emission allowance (CEA) has reached 223 million tons, according to Xinhua News Agency.

　　ETS not only achieves stable operation and healthy development of the trading market, but also plays a pivotal role in promoting greenhouse gas emission reduction of enterprises and strengthening the awareness of low-carbon development of all sectors of society.

　　Carbon trading system may have a significant impact on energy efficiency in China as a key environmental measure, according to a paper published by Science Direct. Both static and dynamic effect analysis shows that carbon trading improves energy efficiency. The impact mechanism analysis shows that the system improves energy efficiency by adjusting the energy structure and promoting green technology innovation. Besides, the carbon trading system has a greater impact on improving energy efficiency in the field of high environmental law enforcement and environmental quality, the paper noted.

　　As the world's largest carbon market, covering more than four billion tonnes of power sector CO_2, ETS is expected to expand into new sectors beyond power generation. It is hoped that this expansion will bring more market participants, increase trade volume, and stabilize the market.