Water pollution trading (WPT) is considered a cost-effective policy instrument for controlling water pollution. Since the late 1990s the Chinese government has piloted WPT programs at different levels in an attempt to reduce water pollution. However, the implementation of WPT programs has not achieved the results expected. Policy overlap, or conflict, is thought to be one of main factors blocking the deployment of effective WPT projects in China. This research takes the WPT pilot program in the Tai Lake Basin as a case study to assess the problem of incoherent policies in this area and to explore the general feasibility of WPT programs in China. We review and analyze the water pollution control system in the Tai Lake Basin as well as the regulation and practices of the WPT Tai Lake pilot program. The results of this study indicate that the WPT program in the Tai Lake Basin conflicts fundamentally with other environmental regulation regimes, such as the Environmental Impact Assessment system and the Five-Year Plan target, and that the prospects for WPT in China are not optimistic. Finally, we outline suggestions for reforming China's WPT mechanism to eliminate these conflicts.
AntesRHansjurgensBLetmatheP, 2008Emissions Trading: Institutional Design, Decision Making and Corporate Strategies (Springer, New York)
2.
BeyerS, 2006, “Environmental law and policy in the People's Republic of China”Chinese Journal of International Law5185
3.
BoxerB, 1998, “China's water problems in the context of US–China relations”China Environment Series220–27
4.
BurtrawDEvansD AKrupnickAPalmerKTothR, 2005, “Economics of pollution trading for SO2 and NOx”Annual Review of Environment and Resources30253–289
5.
CaoHIkedaS, 2005, “Inter-zonal tradable discharge permit system to control water pollution in Tianjin, China”Environmental Science and Technology394692–4699
6.
CaoJZhangSWangC, 2005, “Application of discharge trading to control phosphorus pollution in Taihu Lake”Journal of Hohai University (Natural Sciences)33157–161 (in Chinese)
7.
ChangY CWangN, 2010, “Environmental regulations and emissions trading in China”Energy Policy383356–3364
8.
ChenZ, 2005, “Tackling China's water pollution problem: A legal and institutional perspective from Taihu Lake water pollution control”Temple Journal of Science, Technology and Environmental Law24325
9.
ChengHHuYZhaoJ, 2009, “Meeting China's water shortage crisis: Current practices and challenges”Environmental Science and Technology43240–244
10.
ColebatchH K, 1998Policy (University of Minnesota Press, Minneapolis, MN)
11.
ColebatchH K, 2005, “Policy analysis, policy practice and political science”Australian Journal of Public Administration6414–22
12.
DudekD JQingHZhangJ Y, 2004, “Environmental regualtion capacity analysis: Report of SO2 control and emissions trading cases in China”, Environmental Defense Fund, New York
13.
EllermanA DSchmalenseeRJoskowP LMonteroJ PBaileyE M, 1997, “Emissions trading under the US acid rain program: Evaluation of compliance costs and allowance market performance”, MIT Center for Energy and Environmental Policy Research, Cambridge, MA
14.
Environmental Law Institute, 1997, “Implementing an emissions cap and allowance trading system for greenhouse gases: Lessons from the Acid Rain Program”, Washington, DC
15.
GuttmanDSongY Q, 2007, “Making central–local relations work: Comparing America and China environmental governance systems”Frontiers of Environmental Science and Engineering1418–433
16.
HahnR WStavinsR N, 2010, “The effect of allowance allocations on cap-and-trade system performance”, Resources for the Future, Washington, DC
17.
HuYYangZMeiC, 2010, “‘How to enable enterprises’, understanding the value of discharge permits: Willingness of enterprises to participate in discharge permits trading in Zhejiang Province”Environmental Protection 52–54 (in Chinese)
18.
HuangDGuoH, 2010, “Research of building emissions trading mechanisms to transboundary water pollution in Yangtze River delta area”East China Economic Management2452–54 (in Chinese)
19.
HuangKLiuYGuoHWangJ, 2006, “The framework and its application of water environmental planning for the small watershed”Research on Environmental Science19136–141 (in Chinese)
20.
HuangKGuoHLiuYZhouFYuYWangZ, 2008, “Water environmental planning and management at the watershed scale: A case study of Lake Qilu, China”Frontiers of Environmental Science and Engineering in China2157–162
21.
JPCPC, 1996, “Regulation on Taihu Lake Water Pollution Prevention and Control in Jiangsu”, Jiangsu Provincial Commission of People's Congress
22.
JPCPC, 2007, “Regulation on Taihu Lake Water Pollution Prevention and Control in Jiangsu”, Jiangsu Provincial Commission of People's Congress
23.
JPEPB, 2007, “Water Pollution Discharge Standards of Sewerage Treatment Plants and Important Industrial Branch in Tai Lake Basin (DB32/T1072–2007)”, Jiangsu Provincial Environmental Protection Bureau, Nanjing
24.
JPG, 2007, “Implementation plan of comprehensive management of water environment in Taihu Lake Basin within Jiangsu Province”, Jiangsu Provincial Government, Nanjing
25.
JPG, 2008, “General plan of comprehensive water environment improvement for fifteen major inflow rivers of Taihu Lake Basin”, Jiangsu Provincial Government, Nanjing
26.
LiZ D, 2003, “Energy and environmental problems behind China's high economic growth: A comprehensive study of medium-and long-term problems, measures, and international cooperation”, Institute of Energy Economics, Japan
27.
LiuJDiamondJ, 2005, “China's environment in a globalizing world”Nature4351179–1186
28.
MaXOrtolanoL, 2000Environmental Regulation in China: Institutions, Enforcement, and Compliance (Rowman and Littlefield, Lanham, MD)
29.
MEP, 2007, “Discharge of Main Water Pollutants for Municipal Wastewater Treatment Plant and Key Industries of Tai Lake Basin”, Ministry of Environmental Protection, Beijing
30.
MEP, 2008, “Suggestion on the improvement of emissions trading policy”, Ministry of Environmental Protection, Beijing
31.
MEP, 2009, “Report on National Environmental Statistics in 2008”, Ministry of Environmental Protection, Beijing
32.
MingyuanW, 2008, “China's pollutant discharge permit system evolves behind its economic expansion”Villanova Environmental Law Journal1995
33.
NDRC, 2008, “General plan of water environment comprehensive management in Taihu Lake Basin”, National Development and Reform Commission, Beijing
34.
NobelC EMcDonald-BullerE CKimuraYAllenD T, 2001, “Accounting for spatial variation of ozone productivity in NOx emission trading”Environmental Science and Technology354397–4407
35.
NPC, 2000, “Water Pollution Prevention and Control Law”, National People's Congress, Beijing
36.
OECD, 2006Environmental Compliance and Enforcement in China: An Assessment of Current Practices and Ways Forward (OECD, Paris)
37.
PezzeyJ C, 2003, “Emission taxes and tradeable permits: A comparison of views on long-run efficiency”Environmental and Resource Economics26329–342
38.
PizerW A, 2002, “Combining price and quantity controls to mitigate global climate change”Journal of Public Economics85409–434
39.
QiYMaLZhangHLiH, 2008, “Translating a global issue into local priority”The Journal of Environment and Development17379–400
40.
QuirkP J, 1989, “The cooperative resolution of policy conflict”The American Political Science Review83905–921
41.
SC, 2007, “Comprehensive Working Scheme on Energy Saving and Cutting Pollution of 2007”, State Council, Beijing
42.
ShaoMTangXZhangYLiW, 2006, “City clusters in China: Air and surface water pollution”Frontiers in Ecology and the Environment 4353–361
43.
ShenWYuXJiaW, 2008, “Economic analysis on dealing of pollutant discharge permit regime in Taihu drainage area”Journal of Nanjing Forestry University (Natural Sciences Edition)3219–22 (in Chinese)
44.
SmithS, 1999, “The compatibility of tradable permits with other environmental policy instruments”, in Implementing Domestic Tradable Permits for Environmental Protection (OECD, Paris) pp 199–219
45.
StavinsR N, 1995, “Transaction cost and tradable permits”Journal of Environmental Economic and Management29133–148
46.
SternerTIsakssonL H G, 2006, “Refunded emission payments theory, distribution of costs, and Swedish experience of NOx abatement”Ecological Economics5793–106
47.
StranlundJ K, 2008, “Risk aversion and compliance in markets for pollution control”Journal of Environmental Management88203–210
48.
TaoJMahD N, 2009, “Between market and state: Dilemmas of environmental governance in China's sulphur dioxide emission trading system”Environmental Planning C: Government and Policy21175–188
49.
TaoWZhouBBarronW FYangW, 2000, “Tradable discharge permit system for water pollution: Case of the Upper Nanpan River of China”Environmental and Resource Economics1527–38
TietenbergT H, 2006Emissions Trading: Principles and Practice, Resources for the Future (Washington, DC)
52.
WangE D, 2010, “The investigation on the slowness of emissions trading programs in 11th five-year plan period”, 21st Century Economic Report, http://www.csfee.org.cn/ReadNews.asp?NewslD=629
53.
WangJ NJiangH QYangJ T, 2008, “Paid to use environmental resource in China”, inEmissions Trading: Practice and Innovation Eds WangJ NBiJ, (Chinese Environmental Science Publisher, Beijing) pp 6–10
54.
WangLThompsonTMcDonald-BullerE CAllenD T, 2007, “Photochemical modeling of emissions trading of highly reactive volatile organic compounds in Houston, Texas. 2. Incorporation of chlorine emissions”Environmental Science and Technology412103–2107
55.
WangQ GGuGHiganoY, 2006, “Toward integrated environmental management for challenges in water environmental protection of Lake Taihu Basin in China”Environmental Management37579–588
56.
WoerdmanEvan der GaastW, 2001, “Project-based emissions trading: The impact of institutional arrangements on cost-effectiveness”Mitigation and Adaptation Strategies for Global Change6113–154
57.
WuCMaurerCWangYXueSDavisD L, 1999, “Water pollution and human health in China”Environmental Health Perspectives107251–256
ZhangBYuQ QBiJ, 2010, “Policy design and performance of emissions trading markets: An adaptive agent-based analysis”Environmental Science and Technology445693–5699
60.
ZhangF, 2007, “Does uncertainty matter? A stochastic dynamic analysis of bankable emission permit trading for global climate change policy”, World Bank, Washington, DC
61.
ZhangSXuPLuY, 2010, “The pricing methodology for the compensated use and initial allocation of discharge permits in Zhejiang Province”Environmental Pollution and Control3296–99 (in Chinese)
62.
ZhipingL, 2005, “The challenges of China's discharge permit system and effective solutions”Temple Journal of Science, Technology and Environmental Law24375
63.
ZhuM, 2007, “Critical thinking on the Water Pollutants Discharge Permits Trading Program in Taihu Lake Basin”Environmental Economy435–38 (in Chinese)
