Harmonizing economies and ecologies: Towards an equitable provincial carbon quota allocation for China’s peak emissions

Abstract Rational provincial allocation of carbon quotas serves as the foundational premise for attaining China’s carbon peak. Yet, prevailing strategies often overlook the holistic integration of trade-induced carbon transfers and ecological carbon sequestration, resulting in equity and scientific robustness deficiencies. This study addresses these shortcomings by examining historical carbon sources and sinks across China’s provinces and proposing a novel provincial allocation scheme based on the ‘equal consumption-based cumulative per capita net emission’ principle. Our findings reveal significant disparities in the carbon quotas between provinces, ranging from ‒98 Mt in Shanghai to 1016 Mt in Sichuan, primarily influenced by factors such as population size, historical emissions, and carbon sinks. The proposed scheme, integrating considerations of carbon transfers and sinks, safeguards the interests of less developed provinces (e.g., Hebei and Inner Mongolia) and those with valuable ecosystems (e.g., Yunnan and Inner Mongolia). Furthermore, the impact of carbon transfers on provincial carbon allocation quotas is more pronounced than that of carbon sinks. For instance, the inclusion of carbon transfers has increased Inner Mongolia’s quotas by 238 Mt, compared to 125 Mt attributed to carbon sinks. Considering the disparities in emissions reduction pressure and capacity across different provinces, combining fair carbon quota allocation with a nationwide carbon market can achieve cost-effective emissions reduction while ensuring the attainment of carbon peak.