China to add chemicals, petrochemicals to carbon emissions offsetting scheme

China will expand its national carbon market to include the petrochemical and chemical industries, reports Caixin. The move will bring about 80% of the country’s carbon dioxide emissions under regulatory control.

Regulators will initially focus on high-emitting subsectors including ammonia, oil refining, methanol and ethylene. Their inclusion is also expected to improve market liquidity by adding a more varied mix of participants, from large state-owned groups to independent local refiners.

China launched its national carbon market in 2021 with the power sector as its sole participant. In March 2025, it expanded the program to include steel, cement and aluminum smelting, raising coverage to roughly 60% of national emissions. Bringing in petrochemicals and chemicals would mark the final stage of a government plan to cover all major industrial emitters by 2027.