Low prices for emission permits do not encourage firms to reduce their carbon emissions:
“Chris Rogers, utility analyst at JPMorgan, says that at current prices it is far cheaper for utilities to burn coal – and buy the emissions permits that allow them to pollute – than it is for them to buy cleaner fuels such [...]

The United Nations Development Program (UNDP) is collaborating with the Chinese Ministry of Science and Technology and the Chinese National Development and Reform Commission to establish a carbon emissions trading exchange in China. This would be the first carbon exchange in a developing country. More info in this FT report.
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