(Reuters) - China has ordered seven provinces and cities to set caps on greenhouse gas emissions in preparation for the launch of local pilot carbon markets, according to a notice issued by the country's state planning agency on Friday.
The National Development and Reform Commission requested the cities of Beijing, Tianjin, Shanghai, Chongqing and Shenzhen, along with the provinces of Hubei and Guangdong, to set "overall emissions control targets" and submit proposals as to how the targets will be allocated.
The provinces and cities have also been ordered to set up a dedicated fund to support the project and to draw up comprehensive implementation programs, the notice said.
An implementation plan drawn up by Guangdong, China's biggest CO2-emitting province, has already been approved by the State Council, the country's cabinet.
It commits the province to increasing the share of non-fossil fuels to 20 percent of total energy consumption by 2015, and to cutting the amount of carbon dioxide produced per unit of economic growth -- carbon intensity -- by 19.5 percent.
China as a whole has pledged to reduce carbon intensity by 17 percent over the 2011-2015 period, and said it is committed to using "market mechanisms" in order to reach the target.
It aims to bring 2005 levels of carbon intensity down 40-45 percent by 2020.
Besides the seven official pilot projects, there are more than 100 entities across the country trying to establish their own regional CO2 emissions trading platforms, including the coal-rich province of Shaanxi and the northeast port city of Dalian.
(Reporting by David Stanway; Editing by Ken Wills)