China is considering plans to cap the greenhouse gas emissions of steel, cement and other industries, paving the way for carbon credit trading in the world’s biggest emitter, a newspaper cited an official as saying on Thursday.

The comments from Sun Zhen, a climate official at the National Development and Reform Commission, add to recent signs that Beijing is seriously exploring absolute caps on some high polluting sectors, which would then allow businesses to trade on the right to emit carbon dioxide, the main greenhouse gas from burning fossil fuels and making cement.

China is the world’s biggest emitter of the greenhouse gases from human activity. The cap-and-trade system would be part of the nation’s goal to cut carbon intensity -- the amount of carbon dioxide pollution released for each unit of economic growth–  by 40-45 per cent by 2020 compared with 2005 levels.

"Throughout the country, we have adopted a plan for reducing releases of carbon," Sun told the China Daily, the country’s official English-language newspaper.

"But when it comes to actually reducing the emissions of certain businesses, that calls for limiting the absolute quantity of emissions," said Sun.

"Setting limits on the absolute amounts of carbon that can be emitted will make it possible to carry out trades of emissions credits," Sun said.

Sun did not indicate any time when such a scheme would be launched, but the report said it was likely to target steel and cement makers, and carbon credit trading could also take root in manufacturing hubs such as the Pearl River delta region near Hong Kong and the Yangtze River delta near Shanghai.
Other Chinese officials have recently floated similar ideas.

Xie Zhenhua, a vice minister at the National Development and Reform Commission who steers climate change policy, said last month that China will pilot a carbon trading scheme and gradually build a market for emissions trading.

An official from the NDRC said in April that China would pilot six emissions trading schemes by 2013, and set up a national trading platform by 2015.