[Carbon Offsetting Mechanism of China Province Based on Carbon Reduction Cost]

A reasonable definition of carbon emission responsibility and inter-provincial carbon compensation is an important approach to promote regional coordinated emission reduction. Here, based on the 2017 multi-regional input-output table, carbon emissions from provinces were decomposed by using the value-added trade decomposition method, the embodied carbon flows between provinces were measured, and a differentiated carbon compensation mechanism based on emission reduction cost was designed, which provides the reference for China to carry out horizontal carbon compensation. The main conclusions were as follows:①the carbon emissions caused by the final demand within the province accounted for 53.56%, whereas the carbon emissions caused by the final demand outside the province accounted for 32.49%. The embodied carbon flows among provinces showed a significant existence. ②The embodied carbon showed a significant flow characteristic of transferring from the northern and central regions to the Beijing-Tianjin region and the southeastern coastal regions. ③From the perspective of producers, consumers, and shared responsibility, the total carbon emissions of provinces and cities were equal, and the distribution idea of shared responsibility reflected the "benefit principle." ④There were differences in carbon emission reduction costs between provinces. In areas with low carbon emission reduction costs, direct carbon emissions were high, and the industries were dominated by heavy industry. In areas with high carbon emission reduction costs, direct carbon emissions were low, and the industries were high-tech industries and service industries. ⑤The amount of compensation to be paid/accepted by provinces varied based on the cost of emission reduction. Among them, Guangdong had the highest amount of compensation to be paid, and Inner Mongolia had the highest amount of compensation to be accepted.