Chapter Eight focuses on the carbon offset scheme in China, with a particular emphasis on forestry carbon sequestration, which is a critical element of the nature-based solution to meet carbon neutrality requirements. This chapter examines the substantive and procedural requirements that support the functionality of the domestic carbon offset scheme. However, the existing regulatory framework for the offset scheme does not fully support the proliferation of forestry offset projects. The chapter identifies the challenges that affect the development of forestry carbon sequestration projects. To address these challenges, improvements are needed in the parameters of the methodologies and admission standards for new projects. Additionally, the legal ambiguity concerning the ownership of forestry carbon sinks needs clarification.

Chapter Nine analyses the regulations related to carbon capture and storage (CCS) in China, given its indispensable role in achieving the carbon neutrality target. It starts by elaborating on the essential components of CCS regulation, particularly risk allocation, to provide an analytical framework against which the Chinese regulatory framework for CCS is assessed. This chapter examines the current design of the legal and regulatory systems, identifies the regulatory gaps and uncertainties that hinder the implementation of CCS, and discusses the measures needed to address these gaps and uncertainties. It also explores the legal and regulatory implications of using CO2 as a resource, which has the potential to enhance the commercial viability of CCS and promote the development of the CO2 industry.