1. Report Industry Investment Rating - No relevant information provided 2. Core Viewpoints - In March 2026, the National Carbon Emission Trading Market (CEA) operated stably and further expanded. After the Ministry of Ecology and Environment officially included the steel, cement, and aluminum smelting industries in the national carbon market in February, the market sentiment was generally optimistic this month. However, due to the end - of - quarter compliance expectations and the progress of data verification in new industries, the price showed a high - level volatile consolidation trend [3][39]. - The CEA quota price fluctuated between 80.00 yuan/ton and 83.20 yuan/ton this month, maintaining overall resilience. The market activity rebounded compared to February, with a significant proportion of bulk agreement transactions, indicating that institutional investors and newly included industry entities were adjusting their positions [4][39]. - The core focus this month was on the implementation of the quota allocation plan details for the three high - energy - consuming industries (steel, cement, and aluminum) and the start of data verification work, which provided strong support for the medium - and long - term carbon price. As April enters the traditional compliance peak period and the data verification results of the three industries become clearer, market enthusiasm may further increase, and the price is expected to strengthen [4][41]. 3. Summary by Directory 3.1 Industry News - The expansion of the carbon market started substantially. In February 2026, the Ministry of Ecology and Environment officially included the steel, cement, and aluminum smelting industries in the national carbon market. In March, local ecological environment departments and third - party verification agencies launched the verification of the 2025 carbon emission data of key enterprises in these three industries. The first batch of quota allocation plans for new industries is expected to be announced in early Q2, which has increased the attention of relevant industrial chain enterprises to carbon assets [9]. - In March, the trading volume and price of the national voluntary greenhouse gas emission reduction market (CCER) increased. On March 19, the average CCER transaction price was about 87.02 yuan/ton, slightly higher than the CEA price, showing a small inversion or parity, indicating the scarcity of high - quality emission reduction projects. Afforestation carbon sequestration and renewable energy grid - connected power generation projects were still the main trading items [10]. - Pilot markets in Hubei, Guangdong, etc. were also actively traded this month. In mid - March, the price of the Hubei carbon market (HBEA) maintained a reasonable price difference with the national carbon market, with limited inter - regional arbitrage space, and the market was maturing [11]. 3.2 National Carbon Market Carbon Emission Quotas (CEA) - As of February 27, 2026, the closing price of the national carbon market carbon emission quota (CEA) was 79.90 yuan/ton, the same as the previous month and down 7.23% year - on - year. In the past 30 trading days, the highest CEA price was 83.20 yuan/ton, the lowest was 74.00 yuan/ton, with a fluctuation range of about 9 yuan/ton. In terms of trading volume, the trading activity of national carbon emission quotas decreased in the past 30 trading days, with the average monthly trading volume decreasing by 759,000 tons [12]. 3.3 Carbon Price Influence Factor Analysis 3.3.1 Energy Price - There is a certain correlation between the carbon emission market and the energy market. When energy demand is strong and energy prices rise, the demand for carbon emission quotas is also relatively strong. The increase in carbon price increases the economic efficiency of corporate low - carbon emission reduction, which helps reduce corporate energy demand. Affected by external geopolitical conflicts, the prices of thermal coal and natural gas increased [14]. 3.3.2 Energy Consumption - From January to December 2025, the total apparent consumption of gasoline, coal, and diesel in China was 37,671.13 million tons, 628.74 million tons less than the previous year [22]. 3.3.3 Domestic Carbon Emission Structure - No specific analysis content provided, only relevant figures are mentioned [29] 3.3.4 Total Social Electricity Consumption - In 2025, the total social electricity consumption was 1,036.82 billion kWh, a year - on - year increase of 5.0%. The electricity consumption of the primary industry was 14.94 billion kWh, a year - on - year increase of 9.9%; the secondary industry was 663.66 billion kWh, a year - on - year increase of 3.7%; the tertiary industry was 199.42 billion kWh, a year - on - year increase of 8.2%; and the electricity consumption of urban and rural residents was 158.80 billion kWh, a year - on - year increase of 6.3%. The electricity consumption of the tertiary industry and urban and rural residents contributed 50% to the growth of electricity consumption. The growth rates of electricity consumption in the charging and battery - swapping service industry and the information transmission, software, and information technology service industry reached 48.8% and 17.0% respectively, which were important factors driving the growth of tertiary - industry electricity consumption. The slowdown in the growth rate of secondary - industry electricity consumption was in line with China's economic structural transformation [33]. 3.3.5 Power Generation Structure - From January to February 2026, the proportion of thermal power generation was 67.05%, slightly lower than the same period last year; the proportion of hydropower generation was 93%, slightly higher than the same period last year; and wind power generation was 194.64 billion kWh, also higher than last year [38]. 3.4 Conclusion - In March 2026, the National Carbon Emission Trading Market (CEA) operated stably and further expanded. The market sentiment was generally optimistic, but the price showed a high - level volatile consolidation trend. The CEA quota price fluctuated between 80.00 yuan/ton and 83.20 yuan/ton, maintaining overall resilience. The market activity rebounded compared to February, with a significant proportion of bulk agreement transactions. The implementation of the quota allocation plan details for the three high - energy - consuming industries and the start of data verification work provided strong support for the medium - and long - term carbon price. As April enters the traditional compliance peak period and the data verification results of the three industries become clearer, market enthusiasm may further increase, and the price is expected to strengthen [39][41].

Report Summary 1. Report's Industry Investment Rating - Not provided in the content 2. Core View of the Report - The EUA has stopped falling and is currently stable due to a lack of positive factors. The EU ETS founder's statement about providing more free allowances for low - carbon technology investment is a negative factor, preventing a sharp increase in carbon prices [1] 3. Summary by Related Catalogs Latest Market Conditions - **Primary Market**: The auction price is 77.23 euros/ton, a 4.12% decline, and the bid - to - cover ratio is 2.5 [1] - **Secondary Market**: The EUA futures settlement price is 78.73 euros/ton, a 0.68% increase, with a trading volume of 69,800 lots, a 0.19 decrease [1] Strategy - The signal strength is 0 (0 means empty position, ±1 means slightly long/short, ±2 means long/short). There are no new positive factors, and the negative factor is that the EU ETS founder suggests providing more free allowances for low - carbon technology investment to prevent a sharp rise in carbon prices [1] Other Information - The US announced new oil sanctions on Iran after the end of the negotiation, and the European Commission announced the 20th round of sanctions against Russia on Friday, including the first use of its anti - circumvention tool to limit exports to high - risk regions to reduce the risk of exports to Moscow [1][2] Market Data Tables and Graphs - **Auction Information Table**: It shows the EUA auction volume, CBAM certificate price, EUA auction price, auction revenue, and bid - to - cover ratio on February 5 and February 6, 2026 [2] - **Auction Price and Bid - to - Cover Ratio Seasonal Graphs**: Display the seasonal trends of EUA auction price and bid - to - cover ratio [2][3] - **EUA Futures and Spot Market Information Table**: Presents the futures and spot market information of EUA on February 5 and February 6, 2026, including futures settlement price, trading volume, open interest, and spot settlement price, trading volume [3] - **EUA Futures and Spot Price and Basis Graph**: Shows the EUA futures and spot prices and their basis [3] - **December Contract Open Interest Seasonal Graph**: Displays the seasonal trend of the December contract open interest [3]

Core Viewpoint - The rebound in CEA prices in November is a result of both policy guidance and changes in market supply and demand [4]. Group 1: Price Trends and Influencing Factors - CEA prices have been declining throughout the year, but November saw a rebound with a maximum price of 70.14 yuan/ton and a minimum of 51.54 yuan/ton, closing up 14.80% from the last trading day of the previous month [4]. - The new quota transfer regulations, which increased the basic transfer amount for key emission units in the steel, cement, and aluminum industries from 10,000 tons to 100,000 tons, have contributed to the price rebound [6]. - The end of the surplus quota sell-off and the government's intention to stabilize prices have also played a role in the price recovery [6][7]. Group 2: Policy Signals and Market Stability - Recent announcements, including a new round of national contributions and policies to promote green and low-carbon transitions, have strengthened expectations for the carbon market [7]. - The upcoming compliance deadline at the end of the year has increased the willingness of some companies to purchase quotas [7]. - The fluctuation of carbon prices is considered a normal market phenomenon, influenced by supply-demand relationships, market expectations, and trading behaviors [7]. Group 3: Market Dynamics and Future Outlook - The current carbon price reflects market expectations regarding quota supply and demand, impacting the decisions and interests of both buyers and sellers [9]. - The low carbon price may benefit companies with quota deficits but could hinder surplus companies from maximizing their reduction potential [9]. - The voluntary carbon market (CCER) prices are currently lower than CEA prices, leading some companies to prefer purchasing CCERs to offset their quotas [9][10]. Group 4: Strategic Recommendations for Companies - Companies are advised to adopt a cautiously optimistic approach towards carbon prices, utilizing basic transfer quotas strategically before the end of the year [12]. - The implementation of the EU Carbon Border Adjustment Mechanism (CBAM) in 2026 may indirectly influence China's carbon market rules and expansion speed, but its direct impact on prices is expected to be limited in the short term [12]. - The transition to a mixed allocation of free and paid carbon quotas is anticipated to enhance carbon price stability and market efficiency [13].

Summary of Hydrogen Energy Industry Conference Call Industry Overview - The hydrogen energy industry has evolved significantly since 2002, with a focus on electric vehicles and fuel cell technology. The period from 2014 marked a shift towards supporting the entire fuel cell industry chain, with infrastructure development being recognized in government reports starting in 2019 [1][2][3]. Key Points and Arguments - **Policy Evolution**: The Chinese government has progressively supported hydrogen energy, with the 2020 draft of the Energy Law clarifying hydrogen's energy attributes, which accelerated its implementation [1][2]. - **Cost Reduction**: The cost of fuel cell systems has decreased significantly from nearly 10,000 yuan per kilowatt before 2021 to approximately 2,000 yuan per kilowatt [1][3]. - **Future Goals**: By 2025, the target is to have around 50,000 fuel cell vehicles and to produce 100,000 to 200,000 tons of renewable hydrogen annually. However, achieving these goals may be challenging due to the pandemic [3][6]. - **Government Support**: The government is pushing for the development of hydrogen energy as a key area for technological advancement, with over 150,000 tons of green hydrogen capacity already established [6][17]. - **Carbon Pricing**: Short-term fluctuations in carbon pricing are driven by supply and demand, but the government plans to increase carbon reduction efforts, potentially raising carbon prices to $8-10 during the 14th Five-Year Plan and around $15 during the 15th [7][17]. Challenges and Progress - **Technical Bottlenecks**: The industry faces challenges in fuel cell engine power, lifespan, range, and hydrogen storage and transportation technologies. Infrastructure remains underdeveloped, and economies of scale have not yet been realized [8][9]. - **Subsidy Transition**: There is a shift in subsidies from whole vehicle support to core component support, which includes hydrogen production, storage, and refueling infrastructure [12][13][14]. Regional Developments - **Local Government Initiatives**: Various provinces have developed their own long-term plans that often exceed national targets, with many implementing policies to facilitate project approvals and reduce costs [11][16]. - **Price Variations**: Hydrogen prices vary significantly across regions, with some areas like Shaanxi and Inner Mongolia potentially offering prices as low as 25 yuan per kilogram by 2025, while others remain higher [15]. Future Outlook - The hydrogen energy industry is expected to experience rapid growth driven by supportive policies and technological advancements that lower costs. Continuous monitoring of market expansion and hydrogen production costs will be essential for assessing the industry's potential [17].

1. Report Industry Investment Ratings No specific industry investment ratings are provided in the report. 2. Core Views of the Report - The latest national carbon market quota allocation plans for steel, cement, and aluminum smelting are released, which are expected to boost carbon prices, and carbon prices are likely to recover at an accelerated pace. The potential buyer demand in the market may increase by over 100 million tons in the remaining month of this year, and the actual procurement demand of the three industries is estimated to be around 30 million tons [5]. - MEG is in a weak mid - term trend, with short allocation recommended, and the monthly spread maintains a reverse arbitrage. The supply is expected to return in the future, and there is a pattern of supply - demand surplus, resulting in insufficient upward momentum [6][7]. - The repair market of treasury bond futures has reached its limit. The subsequent market is expected to show a steeper curve and a bearish trend with fluctuations. The probability of scenario one (equity market recovery, bond market under pressure) is relatively high [8][9]. 3. Summaries According to Related Catalogs Carbon Market - The 2024 and 2025 national carbon market quota allocation plans for steel, cement, and aluminum smelting are released. In 2024, the free - allocated quotas equal the quotas to be cleared, and the basic carry - over volume is increased from 10,000 tons to 100,000 tons. In 2025, the overall balance of the three industries is maintained, and the adjustment coefficient of the carbon emission intensity coefficient is expanded from 10% to 15% [5]. MEG - The load of the synthetic gas - to - ethylene glycol unit has decreased from 80% to below 70% in the previous two weeks, but some device overhauls have ended, and new devices are put into production. The monthly import is expected to exceed 600,000 tons. The inventory continues to accumulate, and the polyester load declines in December, resulting in a supply - demand surplus [6][7]. Treasury Bond Futures - The bond market had a repair market due to weak economic data and a decline in global risk appetite. Currently, it is difficult to stimulate the long - end price to continue rising. The bond market curve is expected to become steeper, and the market trend is bearish. There are two scenarios in the future, with scenario one (equity market recovery, bond market under pressure) having a higher probability [8][9]. Other Commodities - **Precious Metals**: Gold shows an increasing expectation of interest rate cuts, and silver is in a volatile adjustment [12]. - **Base Metals**: Copper prices are under pressure due to increased internal and external inventories; zinc is in a range - bound oscillation; lead prices are restricted from falling due to reduced inventories; tin prices are falling from a high level; aluminum shows a slight stabilization, alumina is in a range - bound oscillation, and cast aluminum alloy follows the trend of electrolytic aluminum; nickel prices break through the support level and are under pressure to oscillate, and stainless steel prices are suppressed by weak reality but have limited downward space [12]. - **Energy and Chemicals**: Carbonate lithium may have a short - term correction; industrial silicon may see production cuts to support prices in the future, and polysilicon is in a weak and volatile pattern; iron ore has limited downstream demand space and high valuation; rebar and hot - rolled coil are in a wide - range oscillation; ferrosilicon and silicomanganese experience a weakening market sentiment and supplementary price drops; coke and coking coal are in a wide - range oscillation; logs are in a volatile and repeated state [12]. - **Agricultural Products**: Palm oil has fully priced in short - term negatives, and attention should be paid to the de - stocking process in the producing areas; soybean oil is oscillating strongly; soybean meal and soybeans are in an adjustment and oscillation; corn is oscillating; sugar is in a range - bound arrangement; cotton prices are still suppressed by the pressure of new cotton listing; eggs show a pattern of near - term weakness and long - term strength; live pigs' price increase expectation due to cooling fails, and the pressure is gradually released; peanuts require attention to the spot market [12][15].

Core Viewpoint - Green development is emphasized as a fundamental aspect of China's modernization, with a focus on achieving carbon peak and expanding the national carbon emissions trading market [1] Group 1: National Carbon Emissions Trading Market - The national carbon emissions trading market has been operational for four years, covering over 2,200 key emission units in the power sector, making it the largest carbon market globally in terms of greenhouse gas emissions coverage [1] - The market's design optimization and the relationship between local pilot markets and the national unified carbon market are critical issues that need to be addressed [1][2] - The carbon price fluctuations reflect the market's sensitivity to policy changes, with significant price movements observed around compliance deadlines [3][4] Group 2: Local Carbon Markets - Local carbon markets have provided valuable experience for the national carbon emissions trading market, but they should not disrupt the national market's construction and must complement it [2] - Local pilot markets can focus on managing small and medium-sized enterprises and explore total carbon emission quota controls tailored to local needs [2] Group 3: Carbon Price Dynamics - Carbon price fluctuations are normal, with the market currently being a compliance-driven one, where prices have shown a pattern of rising before compliance deadlines and stabilizing afterward [3][4] - Recent policies, such as the allocation and transfer of quotas, may lead to increased supply and potential price declines [4] Group 4: Market Stability and Risk Management - Establishing a robust market adjustment mechanism is essential to stabilize carbon prices and address market issues, emphasizing the need for transparency and stability in policies [5] - The involvement of financial institutions in the carbon market is encouraged, but it requires the establishment of sound trading and risk management systems [6] Group 5: Preparation for EU Carbon Border Adjustment Mechanism - Companies should prepare for the EU's Carbon Border Adjustment Mechanism by enhancing their carbon trading systems and ensuring accurate carbon footprint calculations [6][7] - Businesses are advised to adopt low-carbon practices and develop internal carbon management systems to effectively track emissions and identify reduction opportunities [7]

Core Viewpoint - The petrochemical industry is a key sector for carbon emission reduction, with a total CO2 emission of approximately 1.46 billion tons in 2022, and is encouraged to develop green hydrogen as a major raw material to significantly lower emissions [1][2]. Group 1: Industry Development - The development of green hydrogen-based chemicals is gaining momentum, with China's electrolytic water hydrogen production capacity reaching about 78,000 tons by the end of 2023, and green ammonia and green methanol capacities at 30,000 tons and 220,000 tons respectively [2]. - The green hydrogen chemical sector is transitioning from "concept verification" to "scale project construction and operation" internationally [2]. Group 2: Economic Factors - The cost of green ammonia and green methanol is currently about 90% higher than traditional methods without considering carbon reduction benefits. Achieving price parity for green ammonia requires a green electricity price of 0.15 yuan/kWh and a carbon price of 180 yuan/ton [3]. - As carbon prices rise and green electricity and hydrogen prices decrease, the competitiveness of green hydrogen routes will continue to improve, with expectations for green hydrogen to approach traditional coal chemical route costs by around 2030 [3]. Group 3: Policy Factors - Policy support is crucial for the economic advantages of green hydrogen to be realized, with international frameworks like the EU ETS creating new demand for green liquid fuels [4]. - Domestic policies promoting sustainable aviation fuel and coal-chemical coupling with green hydrogen are expected to drive demand growth in the green hydrogen chemical market [4]. Group 4: Technological Factors - The maturity of technology and associated cost issues are fundamental for the transition from gray or blue hydrogen to green hydrogen. Current hydrogen production costs are heavily influenced by electricity consumption, which accounts for over 70% of green hydrogen costs [5]. - Significant advancements in ammonia and methanol production processes are needed to enhance yield and purity, as well as to develop flexible synthesis technologies that can adapt to renewable energy fluctuations [6]. Group 5: Market Factors - Despite the large hydrogen demand in the ammonia and methanol sectors, the current high cost of green hydrogen and the incomplete transmission of carbon reduction pressures to enterprises limit the release of green hydrogen demand [7]. - Internationally, the demand for green ammonia and green methanol is growing, particularly in markets like Japan and South Korea, providing export opportunities for China's green hydrogen chemical products [7]. Group 6: Future Recommendations - A strategic plan for green hydrogen chemical development should be established, focusing on demand-driven production and infrastructure support in renewable energy-rich areas [8]. - A comprehensive green product standard system should be developed to facilitate the scaling of green hydrogen chemicals, including certification standards and lifecycle tracking systems [8]. - Policies and market mechanisms should be implemented to lower costs, including integrating the petrochemical industry into the national carbon trading market and providing financial support for demonstration projects [9].

Group 1 - The central government has provided a clear roadmap for building a national carbon market, emphasizing its role as a policy tool for controlling greenhouse gas emissions [1][5] - The goal is to establish a nationwide carbon trading market that covers major industrial sectors by 2027 and to create a comprehensive carbon pricing mechanism by 2030 [1][2] - The transition from intensity control to total volume control and from free to paid quotas indicates a stronger regulatory framework for the carbon market, reflecting the true cost of carbon reduction for enterprises [2][3] Group 2 - The current carbon market operates under a free allocation system based on intensity control, but changes are expected during the "14th Five-Year Plan" and "15th Five-Year Plan" periods [2][3] - The introduction of total volume control is crucial for achieving carbon peak targets by 2030, with a shift towards paid quota allocation expected to enhance efficiency and fairness [3][5] - The carbon price has fluctuated, with recent trading at approximately 69.69 yuan per ton, and is anticipated to rise gradually as the market expands and regulations tighten [6][9] Group 3 - The national carbon market consists of two parts: a mandatory trading market for key emitters and a voluntary market for encouraging self-reduction [7] - The recent policy suggests a potential adjustment in the ratio of voluntary reduction credits that can offset carbon emissions, which could impact market prices and trading volumes [7][9] - Financial institutions and enterprises show strong interest in carbon finance, with expectations for new trading products and improved regulations to facilitate carbon asset management [8][9]

Core Insights - The national carbon market in China is developing steadily, with industry expansion, improved methodologies, and mature market operations, but recent declines in carbon emission allowance (CEA) prices have raised concerns [1] - As of June 27, the average transaction price of CEA was 74.96 yuan/ton, a decrease of approximately 30% from the peak in November of the previous year [1] - Multiple factors, including a significant drop in international energy prices and a loosening of policies, have contributed to the recent decline in carbon prices [2] Market Dynamics - Demand for carbon allowances has weakened due to a decline in thermal power generation, which is the main industry in the national carbon market, with total power generation growth of only 0.1% from January to April, significantly lower than the 6.1% growth in the same period last year [2] - The manufacturing PMI fell below 50% after April, leading to a slowdown in industrial electricity growth, while higher temperatures reduced residential electricity demand [2] - The launch of the national voluntary greenhouse gas reduction trading market (CCER) and the increase in supply expectations have also contributed to the downward pressure on carbon prices [3][4] Future Price Trends - Despite the current decline, experts believe that carbon prices are likely to stabilize and rise in the long term due to the ongoing push for carbon neutrality and the gradual implementation of industry expansion [1][5] - The carbon price is expected to rise as high-emission industries transition and the renewable energy sector grows, with a higher carbon price incentivizing companies to adopt disruptive technologies [5] Global Influences - China's carbon prices may be influenced by other major global carbon markets, such as the EU's carbon border adjustment mechanism (CBAM), which will impose fees on certain products based on carbon market price differences starting in 2026 [6] - The International Monetary Fund (IMF) has suggested that to meet the Paris Agreement goals, the global average carbon price should exceed $85 per ton by 2030, which could also impact China's carbon pricing [6] Market Structure and Regulation - The EU carbon market serves as a reference for improving the financial attributes of carbon markets globally, with a well-established legal framework and a diverse range of trading products [9] - Experts suggest that financial institutions should be gradually introduced into carbon market trading to enhance liquidity and market activity, while ensuring that carbon prices do not rise too quickly [8][10] - There are challenges in the development of carbon finance in China, including the need for clearer legal definitions regarding carbon emission rights and the limitations on financial institutions' direct participation in the carbon market [8]

Group 1 - The core viewpoint is that China is committed to announcing its 2035 national contribution target for all greenhouse gases before the UN Climate Change Conference in November, emphasizing the importance of technology in achieving carbon neutrality goals [1][2] - Current carbon neutrality technologies are primarily in experimental and demonstration stages, with about 50% not yet in application, particularly in low-carbon fuels and carbon capture technologies [1][2] - Industrial carbon neutrality technologies are particularly challenging, with 70% of the 45 listed technologies still in demonstration or theoretical stages, highlighting the need for structural adjustments in the industrial sector [2][4] Group 2 - The steel industry example illustrates that 70% of China's production capacity uses long-process steelmaking, while short-process and hydrogen steelmaking technologies are gradually being adopted [4] - Cost remains a significant barrier to technology-driven carbon reduction, necessitating market mechanisms like carbon pricing to facilitate the transition of technologies from laboratories to market applications [4][5] - China's carbon price currently fluctuates around $10, while international markets are around $100, indicating potential for significant price increases in the future [4] Group 3 - The shift towards green energy is expected to disrupt existing energy structures, with a projected need for mineral resources for new energy by 2040 comparable to 2020 coal extraction levels [5][6] - The distribution of energy resources is changing, with clean technology minerals having a new geographical distribution compared to fossil fuels, which are concentrated in a few countries [5] - The transition from reliance on energy resources to dependence on energy technology is crucial for future economic development [5][6] Group 4 - The rapid development of renewable energy technologies in China over the past decade presents opportunities for collaboration with Belt and Road Initiative countries, which have abundant wind and solar resources [6] - The stability of the power grid is essential for the large-scale application of wind and solar energy, with the next five years being critical for addressing these challenges in China [6]