Emissions Trading Schemes and Their Linking: Challenges and Opportunities in Asia and the Pacific

Asia and the Pacific has achieved rapid economic expansion in the recent years and has become a major source of greenhouse gas (GHG) emissions. With more than half of the world’s population and high rates of economic growth, the region is especially vulnerable to the effects of climate change and therefore must play its part in cutting GHG emissions. 

There are currently 17 emissions trading systems (ETS) in place in four continents and account for nearly 40% of global gross domestic product. In Asia and the Pacific region, there are 11 systems operating, with more being planned. The growing wealth of experience on ETS can be valuable to support developing member countries that are planning and designing new systems of their own. This knowledge product summarizes some of the most significant learning experiences to date and discusses some of the solutions to alleviate challenges that have been faced. It also examines the possibilities for future linked carbon markets in the region.