 This paper examines the effectiveness of China's carbon emission trading pilot policy in reducing carbon emissions, improving energy mixes and reducing air pollution. The study found that the policy was successful in reducing carbon emissions by 38.61%, mainly through reduced coal consumption. Additionally, it also resulted in significant reductions in air pollutants such as sulfur dioxide and nitrogen oxides, with state-owned plants being more affected than privately owned ones. The study also showed that the rate-based allowance allocation system did not affect the policy's effectiveness. This article was offered by Yuxing, Leipeng Tan, and Bing Zhong.