December 2017 China announced, through the National Development and Reform Commission (NDRC) the program for the establishment of a national carbon emissions market (Energy Portal, 2017). The details of the emission trading scheme (ETS) are not made public yet. The ETS will start with the electricity sector covering around 3.5 Gt CO2 emissions (Stavins, 2017) and is expected to start in 2020 (China Carbon Forum, 2017). After that, gradually other industry sectors, such as cement, steel, petroleum refining and chemicals will be added to the program. The ETS targets is not an absolute emissions gap, but a rate based (CO2/Kwh) cap that is set per category per sector. The rate is based on historical trends and technology benchmarks (Stavins, 2017). For example, coal-fired power plants are expected to have different rates, than gas-fired power plants. In the beginning, the permits of this scheme will be grandfathered to the firms, in this case plants emitting more than 26,000 tonnes of CO2 per year (Carbon Brief, 2017).