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An experimental analysis of grandfathering vs dynamic auctioning in the EU ETS

Botelho, Anabela; Fernandes, M. Eduarda; Pinto, Lígia
Fonte: Universidade do Minho. Núcleo de Investigação em Microeconomia Aplicada (NIMA) Publicador: Universidade do Minho. Núcleo de Investigação em Microeconomia Aplicada (NIMA)
Tipo: Trabalho em Andamento
Publicado em /10/2010 Português
Relevância na Pesquisa
66.7%
This study constitutes a first attempt to experimentally test the performance of a 100% auction versus a 100% free allocation of CO2 permits under the rules and parameters that mimic the EU ETS (imperfect competition, uncertainty in emissions’ control, and allowing banking). It also incorporates a first attempt to include in the analysis measures of the risk preferences of subjects participating in emission permits experiments. Another distinctive feature of this study is the implementation of a theoretically appropriate auction format for the primary allocation of emission permits. Our experimental results indicate that the EU ETS has the potential to reduce CO2 emissions, achieving targets considerably more restrictive than the current ones at high efficiency levels, both with auctioned and free emission permits. Auctioning, however, reveals a clear potential to do better than grandfathering the initial allocation of permits. In addition, the results reveal that concerns about undue scarcity, and corresponding high prices, in secondary markets generated by a primary auction market are not warranted under the proposed dynamic auction format.; Fundação para a Ciência e Tecnologia (FCT) - POCTI/ECO/45435/02

Carbon prices. Dynamic analysis of European and Californian markets

Sousa, Rita Mafalda Dionísio de
Fonte: Faculdade de Ciências e Tecnologia Publicador: Faculdade de Ciências e Tecnologia
Tipo: Tese de Doutorado
Publicado em //2014 Português
Relevância na Pesquisa
46.58%
Dissertação para obtenção do Grau de Doutor em Alterações Climáticas e Políticas de Desenvolvimento Sustentável; Carbon markets’ goal is to promote the reduction of emissions of greenhouse gases where it is most cost-efficient. This makes the price of the tradable good – carbon dioxide equivalent (CO2e) - a key variable in management and risk decisions, in markets related to activities connected with the burning of fossil fuels, such as power generation. This work aims to improve the analysis of carbon prices’ dynamics, considering the possibility of multidirectional effects between prices of CO2e, energy (primary and final), offsets licenses and the economy performance, in various frequencies. The two main research questions are: (i) what drives carbon price variations? (ii) what variations do carbon prices drive? We used two comple-mentary methodologies: (a) a vector autoregression model (of common use in macroeconomics and financial markets but not in carbon-energy relations), which allows the analysis of causality and of impulse-response functions of daily prices; and (b) an innovative multivariate wavelet analysis, which allows us to understand the relationship and causal link between the variables in the time and frequency dimensions...

Cap-and-trade and project-based framework: how do carbon markets work for greenhouse emissions reduction?

Godoy,Sara Gurfinkel Marques de; Saes,Maria Sylvia Macchione
Fonte: ANPPAS - Revista Ambiente e Sociedade Publicador: ANPPAS - Revista Ambiente e Sociedade
Tipo: Artigo de Revista Científica Formato: text/html
Publicado em 01/03/2015 Português
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There are two examples of carbon market mechanisms: i ) trading based on the cap-and-trade principle establishes Greenhouse Gases (GHG) emission limits for companies that can negotiate allowance to pollute (as in European Union Emission Trading Scheme, EU ETS) , and ii ) carbon credits, project-based emission reductions of GHG (such as the Clean Development Mechanism of the Kyoto Protocol, CDM). Given the importance of these two, this paper presents the dynamics of the evolution of carbon markets evolution by analyzing different markets (including other examples) and their framework, performances, potential and barriers. Besides these two programs, other national and regional systems are being developed, bu EU ETS and Kyoto stand in terms of volume and visibility. Despite existing criticism, in some countries volume of GHG emissions decreased between 1990 and 2011, probably influenced by the modernization of some formerly obsolete and inefficient industrial plant, and also by the poor performance of world economies in recent years.

Economic impact of the European Union Emission Trading Scheme : evidence from the refining sector; Economic impact of the EU ETS : evidence from the refining sector

Lacombe, Romain H
Fonte: Massachusetts Institute of Technology Publicador: Massachusetts Institute of Technology
Tipo: Tese de Doutorado Formato: 182 p.
Português
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I study the economic impact of the European Union Emission Trading Scheme (EU ETS) on the refining industry in Europe. I contrast previous ex-ante studies with the lessons from a series of interviews I conducted with industrials, and the public data available on the first phase of the scheme, effective from January 1st, 2005 to December 31st, 2007. I conclude that because of organizational inertia, weak incentives linked to the low emission permit price that prevailed during its second part, and important industrial and regulatory constraints, the Phase I of EU ETS has had a limited economic impact on firms. However, this first trading period was instrumental in allowing the rening sector to build the capabilities needed to respond efficiently to the carbon price signal in the long run. I argue that the internal and external constraints that this first phase revealed will shape the future outcome of the scheme. Based on evidence from the rening sector under EU ETS, I take position in the current debate over policy design to suggest ways for regulators to improve the economic impact and environmental effectiveness of carbon markets.; by Romain H. Lacombe.; Thesis (S.M. in Technology and Policy)--Massachusetts Institute of Technology...

Compliance Behavior in the EU-ETS: Cross Border Trading, Banking and Borrowing

Ellerman, A. Denny; Trotignon, Raphael
Fonte: MIT - Massachusetts Institute of Technology Publicador: MIT - Massachusetts Institute of Technology
Tipo: Trabalho em Andamento
Português
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This paper exploits a little used data resource within the central registry of the European Union’s Emissions Trading System (EU ETS) to analyze cross border flows of allowances for compliance purposes during the first trading period (2005- 2007). The extent of cross border trading is small in the aggregate but remarkably frequent in matching allowance deficits and surpluses at the installation level throughout the EU. As such, these data provide evidence of the high and wide-spread market participation that is the precondition of efficient abatement in a cap-and-trade system. There is also remarkable little difference in the monetization of allowance surpluses between participants in the EU15 and those in the East European New Member States. Finally, comparison of these data with the more commonly reported data on allocations and verified emissions reveals considerable recourse to a novel feature of the EU ETS: borrowing from the next year’s allocation to satisfy current compliance requirements.; Massachusetts Institute of Technology. Center for Energy and Environmental Policy Research.

A Top-down and Bottom-up look at Emissions Abatement in Germany in response to the EU ETS

Feilhauer, Stephan M. (Stephan Marvin); Ellerman, A. Denny
Fonte: MIT - Massachusetts Institute of Technology Publicador: MIT - Massachusetts Institute of Technology
Tipo: Trabalho em Andamento
Português
Relevância na Pesquisa
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This paper uses top-down trend analysis and a bottom-up power sector model to define upper and lower boundaries on abatement in Germany in the first phase of the EU Emissions Trading Scheme (2005-2007). Long-term trend analysis reveals the decoupling of economic activity and carbon emissions in Germany that has occurred since 1996 and has accelerated since 2005, in response to rising commodities prices, the introduction of a carbon trading, and other measures undertaken in Germany. Differing emission intensity trends and emissions counterfactuals are constructed using emissions, power generation, and macroeconomic data. Resulting top-down estimates set the upper bound of abatement in Phase I at 121.9 mn tons for all EU-ETS sectors and 56.7 mn tons for the power sector only. Using the tuned version of the model “E-simulate” a lower boundary of Phase I abatement is established at 13.2 million tons, based only on fuel switching in the power sector, which constitutes 61% of German ETS sector emissions. The paper characterizes abatement, critically discusses the underlying assumptions of the outcomes, and examines the impact of two main factors on power sector abatement, namely price and load.; Massachusetts Institute of Technology. Center for Energy and Environmental Policy Research.

The evolution and consequences of the EU Emissions Trading System (EU ETS)

SKJAERSETH, Jon B.
Fonte: Centre de recherche en droit public (CRDP) Publicador: Centre de recherche en droit public (CRDP)
Tipo: Artigo de Revista Científica
Português
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"Jon B. Skjaerseth, professeur associé, Fridtjof Nansen Institute (Norvège), a présenté dans le cadre du panel Gestion des risques environnementaux par les institutions financières,  une conférence intitulée ""The evolution and consequences of the EU Emissions Trading System (EU ETS)""."; "Jon B. Skjaerseth, professor, Fridtjof Nansen Institute (Norway),  presented a lecture titled: ""The evolution and consequences of the EU Emissions Trading System (EU ETS)"" in the panel entilted Environmental Risk Management by Financial Institutions."

Análisis de causalidad y sensibilidad entre precios de Allowances Europeos y CER de Mecanismos de Desarrollo Limpio en el mercado Europeo de Transacción de Emisiones EU-ETS

Perugache Rodríguez, Carol Andrea
Fonte: Pontifícia Universidade Javeriana Publicador: Pontifícia Universidade Javeriana
Tipo: masterThesis; Tesis de Grado Maestría Formato: Pdf
Português
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En el marco del Protocolo de Kioto se desarrolla el análisis de causalidad y sensibilidad entre precios de Allowances Europeos (derechos de emisión) y CER de Mecanismos de Desarrollo Limpio (MDL) en el mercado Europeo de Transacción de Emisiones EU-ETS. Con base en la información de los precios diarios de la bolsa de carbono European Climate Exchange (ECX), actor principal del mercado bilateral organizado de bonos, se genera un modelo de vectores autoregresivos que permite determinar la influencia de choques en el mercado de derechos de emisión sobre el precio de los CERs de MDL. Esta información y el análisis del proceso aplicado en Colombia, es útil para el desarrollo de iniciativas que promuevan el desarrollo sostenible en los países más pobres a través de la generación de proyectos MDL y contribuye la toma de decisiones antes de acordar una posición, debido a que brinda algún nivel de certeza sobre la evolución futura de los precios de los CER.; Using the framework of the Kyoto Protocol, an analysis has been developed concerning the causality and sensitivity between European Allowance prices (emission rights) and the CDM (Clean Development Mechanism) in the Emissions Trading System EU-ETS market. Based on daily stock exchange prices for carbon from the European Climate Exchange (ECX)...

Planes, trains, and automobiles : the EU legislation on climate change and the question of consistency with WTO law

HIESINGER, Stefanie; MAVROIDIS, Petros C.
Fonte: Instituto Universitário Europeu Publicador: Instituto Universitário Europeu
Tipo: Trabalho em Andamento Formato: application/pdf; digital
Português
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The European Trading System (EU ETS) for carbon emissions has been extended to apply to aviation as well, including planes of foreign companies flying between, into and out of European Union (EU) airports: this extension has entailed extensive discussions, especially (but not only) across the legal community. Recently, the EU decided to postpone the application of the EU ETS for flights to and from Europe, but not within, for one year in order to facilitate attempts to look for a global solution under the aegis of the International Civil Aviation Organization (ICAO). In this paper, we discuss the consistency of the regime with the multilateral trading rules. In our view, there are good arguments to support the thesis that the regime adopted by the EU does not run afoul of the relevant rules established by the World Trade Organization (WTO). We stop short of assessing the EU’s policy-decision to postpone the ETS application, and the ensuing question of whether a global solution is feasible, since this paper is confined to a pure legal evaluation of the EU ETS using WTO law as a benchmark.; The Redefining the Transatlantic Relationship and its Role in Shaping Global Governance (TRANSWORLD) project is funded by the European Union’s 7th Framework Programme under grant agreement no. 290454.

Why do emitters trade carbon permits? : firm-level evidence from the European Emission Trading Scheme

ZAKLAN, Aleksandar
Fonte: Instituto Universitário Europeu Publicador: Instituto Universitário Europeu
Tipo: Trabalho em Andamento Formato: application/pdf; digital
Português
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The creation of the EU’s Emission Trading Scheme (EU ETS) has turned the right to emit CO2 into a positively priced intermediate good for the affected firms. Firms thus face the decision whether to source compliance with the EU ETS within their boundaries or to acquire it through the permit trade. However, a combination of internal abatement, free permit allocation and flexibility to shift the use of their allocation across time creates opportunities to achieve compliance with the EU ETS without entering the permit trade. This paper aims to identify firm-level determinants of participation in and the extent of the permit trade while recognizing the possibility of zero trade flows leading to selection bias if unaccounted-for. We construct a firm-level dataset incorporating transaction-level information from both EU ETS operator and person holding accounts, thus representing the entire system-wide permit trade by CO2 emitters. We cover the supply and demand sides of the permit trade, both inter-firm and intra-firm, and account for a wide set of firm-level characteristics using firms’ balance sheet information. A detailed descriptive analysis documents salient features of the firm-level permit trade. We then jointly model firms’ participation and amount decisions while allowing for possible self-selection into trading. Our results suggest that participation in the permit trade is driven by a combination of firm-specific factors existing independently of the EU ETS...

The impact of emissions-performance benchmarking on free allocations in EU ETS phase 3

LECOURT, Stephen; PALLIÈRE, Clément; SARTOR, Oliver
Fonte: Instituto Universitário Europeu Publicador: Instituto Universitário Europeu
Tipo: Trabalho em Andamento Formato: application/pdf; digital
Português
Relevância na Pesquisa
66.7%
From Phase 3 (2013-20) of the European Union Emissions Trading Scheme carbon-intensive industrial emitters will receive free allocations based on harmonised, EU-wide benchmarks. This paper analyses and evaluates the impacts of these new rules on allocations to key energy-intensive sectors. It exploits an original dataset that combines recent data from the National Implementing Measures of 20 Member States with the Community Independent Transaction Log and ETS-installation NACE code data. The analysis reveals that free allocations to benchmarked sectors will be reduced significantly, though not excessively, in Phase 3. This reduction should both increase public revenues from carbon auctions and has the potential to enhance the economic efficiency of the carbon market. The analysis also shows that changes in allocation vary mostly across installations within, rather than across, countries. Lastly, the analysis finds evidence that the new rules will, as intended, reward installations with better emissions performance, and will improve harmonisation of free allocations in the EU ETS by reducing differences in allocation levels across countries with similar carbon intensities of production.

Does the EU ETS bite? : the impact of allowance over-allocation on share prices

JONG, Thijs; COUWENBERG, Oscar; WOERDMAN, Edwin
Fonte: Instituto Universitário Europeu Publicador: Instituto Universitário Europeu
Tipo: Trabalho em Andamento Formato: application/pdf; digital
Português
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The aim of this paper is to examine whether shareholders consider the EU Emissions Trading Scheme (EU ETS) as value-relevant for the participating firms. An analysis is conducted of the share prices changes as caused by the first publication of compliance data in April, 2006, which disclosed an over-allocation of emission allowances. Through an event study, it is shown that share prices actually increased as a result of the allowance price drop when firms have a lower carbon-intensity of production and larger allowance holdings. There was no significant value impact from firms’ allowance trade activity or from the pass-through of carbon-related production costs (carbon leakage). The conclusion is that the EU ETS does ‘bite’. The main impact on the share prices of firms arises from their carbon-intensity of production. The EU ETS is thus valued as a restriction on pollution.

The EU ETS : eight years and counting

ELLERMAN, A. Denny; MARCANTONINI, Claudio; ZAKLAN, Aleksandar
Fonte: Instituto Universitário Europeu Publicador: Instituto Universitário Europeu
Tipo: Trabalho em Andamento Formato: application/pdf; digital
Português
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This paper provides an introduction to the EU’s Emissions Trading System. As such it provides a discussion of the historical and legal context in which the EU ETS developed and now operates, a presentation of the key performance indicators for the first eight years through the end of the second phase in 2012, and some concluding observations on the system’s future. The paper is purposively descriptive to provide background for more analytically oriented articles, as well as to provide a matter-of-fact presentation for readers who wish to learn about or be updated on the progress of the EU ETS.

An analysis of allowance banking in the EU ETS

ELLERMAN, Denny; VALERO, Vanessa; ZAKLAN, Aleksandar
Fonte: Instituto Universitário Europeu Publicador: Instituto Universitário Europeu
Tipo: Trabalho em Andamento Formato: application/pdf
Português
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The existence of some 2 billion unused EU Allowances (EUAs) at the end of Phase II of the EU's Emissions Trading System (EU ETS) has sparked considerable debate about structural shortcomings of the EU ETS. At the same time, there has been a surprising lack of interest in one possible explanation of this accumulation of EUAs: the theory of intertemporal permit trading, i.e. allowance banking. In this paper we adapt basic banking theory to the case of a smoothly declining cap such as that in the EU ETS. We show that it is rational for agents to decrease emissions beyond the constraint imposed by the cap initially, accumulating an allowance bank and then drawing it down in the interest of minimizing abatement cost over time. Having laid out the theory, we carry out a set of simulations for a reasonable range of key parameters, calibrated to the EU ETS, to illustrate the effects of intertemporal optimization of abatement decisions on optimal time paths of emissions and allowance prices. We also explore the effect of an unexpected change in counterfactual emissions. We conclude that bank accumulation as the result of intertemporal abatement cost optimization should be considered at least a partial explanation when evaluating the current discrepancy between the cap and observed emissions in the EU ETS.

EU emissions trading by energy firms

JONG, Thijs; ZEITLBERGER, Alexander C.M.
Fonte: Instituto Universitário Europeu Publicador: Instituto Universitário Europeu
Tipo: Trabalho em Andamento Formato: application/pdf
Português
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This paper aims to identify what determines the allowance transactions of energy firms on the European carbon market (EU ETS). We develop measures of their 'autarky' regarding the carbon market, their allowance hedging, and the allowance holdings which ensure optimal EU ETS compliance. Although under-allocated over Phase I, energy firms held more allowances than needed. By selling allowances, only the non-autarkic firms followed their optimal compliance holdings and, hence, actually behaved autarkical. Autarkic firms, conversely, purchased more allowances than they needed. Moreover, and unlike non-autarkic firms, their allowance trades were responsive to energy demand and indicative of carbon hedging. Finally, all energy firms utilized the carbon market's abatement potential, which affirms that the EU ETS leads to relative cost savings. As especially autarkic energy firms utilized this potential, and may have reaped additional savings from their active hedging, they behaved least autarkical regarding the carbon market.

Impact of Renewables Deployment on the CO2 Price and the CO2 Emissions in the European Electricity Sector

VAN DEN BERGH, Kenneth; DELARUE, Erik; D'HAESELEER, William
Fonte: Instituto Universitário Europeu Publicador: Instituto Universitário Europeu
Tipo: Trabalho em Andamento Formato: application/pdf
Português
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As of 2005, electricity generators in Europe operate under the European Union Emission Trading System (EU ETS). At the same time, European Member States have launched support mechanisms to stimulate the deployment of renewable electricity sources (RES-E). RES-E injections displace CO2 emissions within the sectors operating under the EU ETS and they reduce the demand for European Union Allowances (EUAs), therefore reducing the EUA price. This paper presents the results of an ex-post analysis to quantify the impact of RES-E deployment on the EUA price and CO2 emissions in the Western and Southern European electricity sector during the period from 2007 to 2010. This study shows that the CO2 displacement from the electricity sector to other ETS sectors due to RES-E deployment can be up to more than 10 % of historical CO2 emissions in the electricity sector. The EUA price decrease caused by RES-E deployment varies between zero and multiple times the historical EUA price.

Les produits dérivés des marchés européens du carbone

Godin, Frédéric
Fonte: Université de Montréal Publicador: Université de Montréal
Tipo: Thèse ou Mémoire numérique / Electronic Thesis or Dissertation
Português
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Au cours de la dernière décennie, l'Union Européenne a instauré une réglementation environnementale afin de limiter les émissions de Gaz à Effet de Serre sur son territoire. Ceci a contribué à la mise en place d'un marché du carbone européen (EU ETS) où s'échangent des certificats d'émission de CO2 (les EUA et les CER) ainsi que des produits dérivés reliés à ceux-ci. Ce mémoire aura pour objectif d'évaluer et de comparer différents modèles afin de représenter le prix des certificats d'émission et de tarifer les produits dérivés des marchés du carbone.; During the last decade, the European Union has regulated emissions of Greenhouse Gases on its own territory. Consequently, a European Carbon Market (EU ETS) is currently emerging where CO2 emission certificates (EUA and CER) and derivatives are traded on Exchanges. The objectif of this research is to evaluate and compare different models to represent the emission certificates' price and to price derivatives of the carbon markets.; L'analyse statistique des données a été effectuée avec le logiciel R.

O mercado das emissões de c02 análise do sector energético português

Costa, Joaquim José Monteiro da
Fonte: Instituto Superior de Economia e Gestão Publicador: Instituto Superior de Economia e Gestão
Tipo: Dissertação de Mestrado
Publicado em /04/2009 Português
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46.58%
Mestrado em Economia e Gestão de Ciência, Tecnologia e Inovação; As emissões de dióxido de carbono (C02) deixaram de ser um bem livre. Este é o resultado da criação do Comércio Europeu de Licenças de Emissão (CELE), que criou o maior mercado mundial de licenças de emissão, envolvendo cerca de 12.000 instalações ao longo dos 25 Estados Membros (EM) da União Europeia. Os maiores riscos que afectam as empresas envolvidas no CELE vêm essencialmente dos possíveis movimentos no preço e na disponibilidade de um número suficiente de licenças para um determinado período de tempo. O C02 transpôs as diferenças entre gás, electricidade e os preços das mercadorias a nível mundial. As bolsas e as plataformas de trading estão a ser usadas para agarrar uma quota no rápido crescimento do mercado de carbono. Por outro lado, este sistema de limitação e comércio como forma de reduzir as emissões de C02 das grandes fontes industriais, tem em conta que os limites fixados obrigarão as empresas a inovar e tornarem-se mais eficientes. Porém, o bom funcionamento do sistema depende de forma crítica dos EM definirem Planos Nacionais de Alocação de Licenças de emissões, que fixem objectivos credíveis e ambiciosos, e da sensibilização dos agentes económicos para o mercado de carbono...

Sistema de emisiones EU ETS en aviación civil

Marruecos, Helena
Fonte: Universidade Autônoma de Barcelona Publicador: Universidade Autônoma de Barcelona
Tipo: info:eu-repo/semantics/bachelorThesis; Text Formato: application/pdf
Publicado em //2014 Português
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Bibliografia; Este trabajo tiene como objetivo explicar el porqué de la existencia del Sistema EU ETS, como funciona y cuáles son las implicaciones para los Operadores Aéreos. A demás expone temáticas relacionadas con el EU ETS como son el cambio climático, la normativa internacional, europea así como nacional, los Mercados de Carbono donde se realizan las transacciones de los derechos de emisión y los informes que los Operadores Aéreos deben presentar a la Autoridad Competente.; Aquest treball tracta d’explicar el perquè de l’existència del Sistema EU ETS, com funciona i quines són les implicacions per als Operadors Aeris. A més a més exposa temàtiques relacionades amb l’EU ETS com són el canvi climàtic, la normativa internacional, europea i nacional, els Mercats de Carboni on tenen lloc les transaccions dels drets d’emissió i els informes que els Operadors Aeris han de presentar a l’Autoritat Competent.; The aim of this work is explain the reason why the EU ETS System exists, how it works and which are the implications for Air Operators. In addition exposes other related thematic like Climate Change, international law as well as European and Spanish law, Carbon Markets where the allowances trade takes place and Air Operator’s mandatory reports.

Differentiation and Dynamics of Competitiveness Impacts from the EU ETS

Sato, Misato; Grubb, Michael; Cust, J.; Chan, Katie; Korppoo, Anna; Ceppi, Pablo
Fonte: Faculty of Economics, University of Cambridge, UK Publicador: Faculty of Economics, University of Cambridge, UK
Tipo: Trabalho em Andamento
Português
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We summarise the main factors that differentiate impacts of the EU ETS on profitability and market share. By examining and sampling a range of sectors, we present some simple metrics and indicators to help judge the nature of potential impacts. We also consider briefly the mitigation response to these impacts by sectors, and how they may evolve over time. The broad conclusion confirms the aggregate findings presented in the existing literature - more participating sectors are likely to profit under the current ETS structure out to 2012 at the cost of a modest loss of market share, but this may not hold for individual companies and regions. The period 2008-12 can assist technology investments and diversification, providing the continuation and basic principles of the EU ETS post-2012 is quickly defined and incentives are in place for sectors to pursue this.