China’s Carbon Market Tops 900 Million Tons in Cumulative Trading Volume
China’s national carbon emissions trading market has surpassed 930 million tons in cumulative trading volume as of the end of July 2026, according to Xinhua News. The milestone was announced by Minister of Ecology and Environment Huang Runqiu at a State Council Information Office press conference on August 13, marking a significant achievement for the world’s largest carbon market by emissions coverage.
A Growing Market with Global Significance
The cumulative trading value has reached 632.72 billion yuan (approximately $88 billion USD), according to data from the Shanghai Environment and Energy Exchange. The market currently covers four industries—power generation, steel, cement, and aluminum smelting—encompassing 3,378 key emission units that account for approximately 8.3 billion tons of CO2 emissions annually, or about 65 percent of China’s total carbon emissions.
“As of the end of July, the cumulative trading volume of the national carbon emissions trading market has exceeded 930 million tons, which has effectively promoted green and low-carbon transformation while driving low-cost carbon reduction in industries,” Huang said at the press conference, as reported by 21st Century Business Herald.
From Launch to Expansion
The national carbon market officially launched trading on July 16, 2021, initially covering only the power generation sector with 2,162 key emission units. In March 2025, the Ministry of Ecology and Environment expanded the market to include steel, cement, and aluminum smelting industries—the first expansion since its launch—increasing coverage from roughly 40 percent to over 60 percent of China’s total CO2 emissions, according to the Ministry of Ecology and Environment.
The market’s growth has been steady and substantial. In 2025 alone, the market traded 235 million tons of carbon allowances, up approximately 24 percent year-on-year, with trading value reaching 14.63 billion yuan, according to the Ministry of Ecology and Environment’s 2025 Carbon Market Report. The year-end closing price stood at 74.63 yuan per ton, with an annual average price of 62.36 yuan per ton.
Market Infrastructure and Corporate Engagement
The carbon market operates through a dual-center system: trading occurs at the Shanghai Environment and Energy Exchange, while registration and settlement are managed by the China Carbon Emissions Registration and Settlement System (中碳登) based in Hubei Province. Hubei Daily reported that the settlement team processes massive amounts of data daily, with all settlements completed on the same day trading closes.
The market has also created tangible benefits for participating companies. Xia Feng, head of carbon asset management at Gezhouba Cement, described how his company purchased hundreds of thousands of tons of carbon allowances from thermal power companies at 70 yuan per ton and sold them at nearly 80 yuan per ton, netting 3 million yuan from a single transaction, as reported by Hubei Daily.
Driving Emissions Reductions
The carbon market’s impact extends beyond trading volumes. Approximately 80 percent of enterprises covered by the market have achieved reductions in carbon emission intensity, and the 2024 annual compliance rate for quota settlement reached approximately 99.99 percent, according to China Economic Net. The market has become a cornerstone of China’s climate policy framework, supporting the country’s commitments to peak carbon emissions before 2030 and achieve carbon neutrality by 2060.
Looking Ahead
The Ministry of Ecology and Environment has initiated preparatory work to further expand the carbon market to include chemical, petrochemical, civil aviation, and paper industries. The “Beautiful China Construction ‘15th Five-Year Plan,” issued by the State Council in June 2026, explicitly calls for accelerating the development of the national carbon market, targeting a 3 percent reduction in carbon emissions per unit of product in covered industries by 2030.
As China’s carbon market enters its next phase of development, the transition from intensity-based to absolute cap-based allocation, along with continued industry expansion, will be critical to maintaining momentum. The newly enacted Ecological Environment Code, effective August 15, 2026, provides stronger legal backing for carbon market operations, positioning China’s carbon pricing mechanism for continued growth on the global stage.
With cumulative trading volume now exceeding 900 million tons and the market expanding to cover more than half of China’s emissions, the national carbon market has firmly established itself as a central pillar of the country’s green transition—and a model for carbon pricing worldwide.