Abstract: In the context of the low carbon strategy, carbon trading system plays an important role in reducing carbon emissions of the power industry. Using a sample of 30 provinces in China and local carbon trading pilot policies as a quasi-natural experiment, this paper examines the real effect of carbon emissions trading policies by difference in differences (DID) estimations. The study finds that, first, carbon emissions of power industry in pilot provinces decline more rapidly than that in non-pilot provinces. Second, the carbon emissions of the power industry in a province are negatively related to the total volume and amount of local carbon trading. These findings imply that China's carbon trading pilot system has a positive effect on carbon emissions reduction of local power industry.