China’s leaders have committed to reducing the carbon intensity of energy consumed 40-45% by 2020 and the 12th Five Year Plan requires new reduction goals for NOx, and additional reductions for SO2. China also intends to pilot a coal consumption cap in at least one province, and their new DSM rule requires grid companies to achieve proscribed energy savings goals. Market-based mechanisms like cap-and-trade or energy certificate programs could help China to achieve the environmental and energy goals cost-effectively and within the same timeframe or sooner. The design of market-based programs is critical, since any trading scheme requires credibility and transparency in order for the emissions savings to be real, and the currency to be accepted. RAP’s Chris James was asked by the Chinese Academy of Social Sciences to discuss the US experiences in developing the NOx budget and Regional Greenhouse Gas Initiative, and global programs such as the EU ETS and the Australian white tag program, what China could learn from these experiences, and what criteria China should evaluate as it considers developing market-based mechanisms there.