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BEIJING: China launched a carbon trading system Monday designed to drive down emissions, as the world’s biggest polluter takes steps towards decarbonising its economy by 2060.

The scheme lets provincial governments set pollution caps for big-power businesses for the first time and allows firms to buy the right to pollute from others with a lower carbon footprint.

The programme, initially set to launch in 2017, is expected to drive down overall emissions by making it more costly for power companies to pollute. The system is expected to eclipse that of the European Union to become the world’s largest emissions trading scheme (ETS).

Official news agency Xinhua said rules for carbon emissions trading management came into effect Monday.

It reported that more than 2,200 power firms across the country — which emit over 26,000 tonnes of greenhouse gases a year — could now trade their emission quotas.

Beijing has pledged to peak emissions before 2030 and become carbon neutral 30 years later.

The ETS launches, however, as experts warn China is actually expanding its coal production — and after plans to curb emissions from seven other industries were pared back.

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