China's steel industry, one of the country's largest producers of greenhouse gases, is coming under increased pressure to curb its gas emissions. This follows a comment from a senior central government official that Beijing could impose a carbon tax as soon as 2012, with the initial tax rate of RMB 10-20/tonne ($1.5-3/t) of carbon dioxide emissions.
An official from China's powerful National Development and Reform Commission (NDRC) said at a recent environmental protection conference that a preliminary investigation into imposing the tax have been completed.
Local media quote the official as saying the carbon tax would be introduced during the twelfth five-year plan (2011-2015), probably around 2012. The government plans to use the funds generated by the taxes on providing subsidies to environmental protection sectors and â€˜green' companies, the reports said.
At the same conference, a northern Chinese steel mill suggested that before the authorities introduce the tax they should take into consideration the tax pressures that enterprises already face. But he agreed that low-carbon development must inevitably be the trend now.
Some industry experts warned earlier that with China's crude steel production set to exceed 600m tonnes in 2010, reducing emissions will present a severe challenge, as Steel Business Briefing reported. China's steel industry typically emits around 2 tonnes of CO2 per tonne of crude steel, SBB notes.
China's central government is now adopting a stronger stance to encourage the development of a low-carbon economy, SBB observes. Last November China announced it will reduce its CO2 emissions per unit of GDP by 40-45% within the next ten years from 2005 levels.