China’s national carbon market finally entered full operation on July 16th. Carbon allowances equivalent to 4 billion tons of CO2 have been issued, covering only the power generation sector. A looming expansion will usher in petrochemicals, chemicals, building materials, steel, nonferrous metals, papermaking, and domestic aviation, bringing total coverage to between 8 billion or 10 billion tons – that’s most of China’s annual emissions, which reached 14.4 billion tons in 2020. The new national market will continue to feature the allowances seen in previous local pilots, which are issued annually by the government to companies, free of charge. If a company emits more than its own allowances account for, it must buy allowances off other companies who did not use…