Photo taken on Nov. 26, 2013 shows the exterior of the Shanghai Environment and Energy Exchange(SEEE) where the inaugural ceremony of the carbon emission trading program is held in Shanghai, east China. Shanghai launched carbon emission trading on Tuesday, China's second market for compulsory carbon trading. (Xinhua/Shen Chunchen)

Construction is set to start on China's largest carbon capture project in East China's Jiangsu Province, while trading on the domestic carbon market has expanded, as the country accelerates efforts to achieve the carbon emissions reduction goals.

The project involving the Taizhou Power Plant of the Jiangsu branch of China Energy, designed to capture 500,000 tons of carbon each year, will be completed and put into operation in 2023, according to officials at the plant, China Media Group (CMG) reported. 

The captured carbon dioxide will be widely used in oil field displacement and the chemical industry in Jiangsu.

"Our production cost is 250 yuan ($39.27) per ton while the price of carbon dioxide in surrounding areas can reach about 300 yuan per ton. The profitability of the whole project is strong," an official of the project told CMG. 

China's oil giant Sinopec will build carbon capture, utilization and storage projects in the Jiangsu Oilfield in Yangzhou, Jiangsu, and inject the captured carbon dioxide to extract more oil.

There are about 10 billion tons of petroleum geological reserves in China suitable for carbon dioxide fluid extraction technology. It is expected that the environmentally friendly and highly efficient extraction technology will increase oil production by 700 million to 1.4 billion tons nationwide, according to Sinopec, CMG reported.

Meanwhile, trading on China's carbon market has expanded after the Ministry of Ecology and Environment ordered all provinces and cities to ensure that all the key facilities finalized emission allowances before December 31.

In July, China launched the world's largest carbon market to harness market forces to achieve a significant reduction in carbon dioxide emissions.

On Friday, the total turnover of carbon emissions quotas hit 7.52 million tons, with a total value of 308.6 million yuan - both reaching new highs since trading started on July 16, according to the Shanghai Environment and Energy Exchange (SEEE). The price was up 0.61 percent on Monday to close at 42.95 yuan per ton.

To date, among the five power generation groups, China Datang Corp and China Huadian Corp have completed their trading allowances for all key emission facilities, with the average transaction prices standing at 42.14 yuan and 43.21 yuan per ton respectively.

Global Times