The Revision of the European Union’s Emissions Trading System Ahead of the Fourth Trading Period, 2021–2030

Climate Law ◽  
2018 ◽  
Vol 8 (3-4) ◽  
pp. 338-348 ◽  
Author(s):  
Joshua Prentice
Keyword(s):  
Emissions Trading ◽  
Decisive Role ◽  
Cost Effective ◽  
Eu Ets ◽  
The European Union ◽  
Trading System ◽  
Effective Manner ◽  
Trading Period ◽  
Final Agreement

The EU ETS is the cornerstone of the European Union’s climate policy. The EU ETS will play a decisive role in the European Union plan to meet its commitments under the Paris Agreement. In November 2017, following more than two years of negotiations, EU member states and the European Parliament reached a final agreement on the revision of the EU ETS for the period 2021–2030. The final agreement struck an important, ambitious balance on a number of measures designed to ensure that the EU ETS achieves its legislative aims of promoting emission reductions in a cost-effective manner. The negotiations also provide a number of policy lessons for future negotiations relating to the role of EU institutions and the rules for free allocation which will be important for the EU ETS to meet its legislative objectives. 1

scholarly journals European union emissions trading system with regard to climate change mitigation in Latvia

2012 ◽  
Vol 8 (-1) ◽  
pp. 29-35 ◽  
Author(s):  
Ilze Pruse
Keyword(s):  
European Union ◽  
Climate Change Mitigation ◽  
Emissions Trading ◽  
Ghg Emissions ◽  
Eu Ets ◽  
The European Union ◽  
Ghg Emission ◽  
Trading System ◽  
Change Mitigation ◽  
The Eu

Abstract The goal of this paper is to analyse the volumes of greenhouse gas (GHG) emissions from the European Union Emissions Trading System’s (EU ETS) participants in Latvia in relation to their participation therein. After describing and discussing the EU ETS mechanism and its operation in Latvia in the period 2005-2010, the interconnectedness between the GHG emissions and the EU ETS participants’ operation is analysed. The analysis concludes that, although the EU ETS has contributed towards GHG emission reduction, due to the growth of the economy, overall GHG emissions from the EU ETS participants in Latvia are increasing.

scholarly journals Factors and Contingencies for the “It Pays to Be Green Hypothesis”. The European Union’s Emissions Trading System (EU ETS) and Financial Crisis as Contexts

2019 ◽  
Vol 16 (16) ◽  
pp. 2988 ◽  
Author(s):  
Joaquín Cañón-de-Francia ◽  
Concepión Garcés-Ayerbe
Keyword(s):  
Financial Crisis ◽  
Empirical Evidence ◽  
Emissions Trading ◽  
Positive Relationship ◽  
Eu Ets ◽  
The European Union ◽  
Trading System ◽  
Industrial Companies ◽  
External Conditions ◽  
Emissions Trading System

This study provides empirical evidence related to the “it pays to be green” hypothesis. Based on information from panel data approximately 42 industrial companies during an 8-year period, we determine some of the factors and contingences that affect the fulfilment of that hypothesis. We find that a certain level of proactivity in environmental strategy design is one of the conditions that favors a positive relationship between environmental investment and financial performance. We also provide empirical evidence on how some external conditions affect this positive relationship, such as regulatory pressure from the European Union Emissions Trading System (EU ETS) and the financial crisis.

scholarly journals Emissions Trading Hybrids: The Case of the EU ETS

2019 ◽  
Vol 15 (1) ◽  
Author(s):  
Edwin Woerdman ◽  
Andries Nentjes
Keyword(s):  
Emissions Trading ◽  
Production Capacity ◽  
Performance Standard ◽  
Eu Ets ◽  
The European Union ◽  
Cap And Trade ◽  
Trading System ◽  
Standard Rate ◽  
High Level ◽  
The Eu

Abstract We argue that the European Union Emissions Trading System (EU ETS) has evolved into a hybrid of two design variants, allowance trading (cap-and-trade) and credit trading (performance standard rate trading), with an added feature of industry support to minimize carbon leakage. In particular the current rules tying free allowances to production capacity expansion, plant closure and capacity use have transformed the efficient cap-and-trade program that stood at the origins of the EU ETS into a system that even surpasses credit trading in paying hidden product subsidies to firms. This combination of rules encourages an inefficiently high level of investment in production capacity and an inefficiently high output in industries exposed to international competition. The result is a sub-optimal EU Emissions Trading ‘Hybrid’ (which we therefore label as ‘EU ETH’).

scholarly journals Impact of Eu Ets on Sustainable Development of its Participants in Latvia

2012 ◽  
Vol 11 (1) ◽  
pp. 165-177
Author(s):  
Ilze Prūse
Keyword(s):  
Sustainable Development ◽  
Emissions Trading ◽  
Greenhouse Gas Emission ◽  
Eu Ets ◽  
The European Union ◽  
Gas Emission ◽  
Trading System ◽  
The Sustainable Development ◽  
The Impact ◽  
The Eu

Abstract Latvia is covered by the European Union Emissions Trading System (EU ETS) and therein 80 participants from Latvia have participated. The goal of the paper is to analyse the impact of the EU ETS on the sustainable development of its participants in Latvia. The concept of sustainable development is explored with respect to both macro and micro scale and in the context of sustainable development the EU ETS is described. The impact of the EU ETS on its participants in Latvia is considered by means of methods of quantitative and qualitative analysis. It has been established that in past the participants of the EU ETS from Latvia had generally beneficial positions in the EU ETS; hence although the EU ETS did not directly promote greenhouse gas emission reductions, it provided opportunities to gain additional profits and many of the EU ETS participants in Latvia made use of them. In addition, certain interrelationships have been identified between the data on the EU ETS participants performing EUA trading and the data on the EU ETS participants not performing EUA trading. It has been concluded that the EU ETS might have contributed towards the sustainable development of its participants in Latvia within its certain dimensions.

The EU Emissions Trading System in Crisis-Ridden Greece: Climate under Neoliberalism

2020 ◽  
pp. 048661342091054
Author(s):  
Andriana Vlachou ◽  
Georgios Pantelias
Keyword(s):  
Emissions Trading ◽  
Eu Ets ◽  
Low Carbon ◽  
The European Union ◽  
Trading System ◽  
Distributional Effects ◽  
Low Carbon Economy ◽  
Environmental Effectiveness ◽  
Emissions Trading System ◽  
The Eu

Neoliberal capitalism has extended the use of markets to address climate and energy issues. Carbon trading characteristically exemplifies the neoliberalization of climate policy. This paper discusses the workings of the European Union’s Emissions Trading System (EU ETS) in the European Union (EU) with a focus on its application in crisis-ridden Greece. Beyond environmental effectiveness and distributional effects, the paper explores the interactions of the EU ETS with crisis, austerity programs, energy poverty, and uneven development. Despite adjustments and changes, the EU ETS continues to indicate limited environmental effectiveness and unjust distributional effects. Moreover, by forging a centralized neoliberal transition to a low-carbon economy without consideration of the issues faced by unevenly developed and crisis-stricken EU members such as Greece, the EU ETS leads to additional disturbances and problems for the Greek economy as a whole, its pauperized working people, and its energy and climate options to reduce emissions on its own potential, needs, and priorities.

scholarly journals The European Union Emissions Trading System reduced CO2 emissions despite low prices

2020 ◽  
Vol 117 (16) ◽  
pp. 8804-8812 ◽  
Author(s):  
Patrick Bayer ◽  
Michaël Aklin
Keyword(s):  
European Union ◽  
Carbon Emissions ◽  
Emissions Trading ◽  
Carbon Markets ◽  
Eu Ets ◽  
The European Union ◽  
Trading System ◽  
Market Prices ◽  
Emissions Trading System ◽  
The Eu

International carbon markets are an appealing and increasingly popular tool to regulate carbon emissions. By putting a price on carbon, carbon markets reshape incentives faced by firms and reduce the value of emissions. How effective are carbon markets? Observers have tended to infer their effectiveness from market prices. The general belief is that a carbon market needs a high price in order to reduce emissions. As a result, many observers remain skeptical of initiatives such as the European Union Emissions Trading System (EU ETS), whose price remained low (compared to the social cost of carbon). In this paper, we assess whether the EU ETS reduced CO2 emissions despite low prices. We motivate our study by documenting that a carbon market can be effective if it is a credible institution that can plausibly become more stringent in the future. In such a case, firms might cut emissions even though market prices are low. In fact, low prices can be a signal that the demand for carbon permits weakens. Thus, low prices are compatible with successful carbon markets. To assess whether the EU ETS reduced carbon emissions even as permits were cheap, we estimate counterfactual carbon emissions using an original sectoral emissions dataset. We find that the EU ETS saved about 1.2 billion tons of CO2 between 2008 and 2016 (3.8%) relative to a world without carbon markets, or almost half of what EU governments promised to reduce under their Kyoto Protocol commitments. Emission reductions in sectors covered under the EU ETS were higher.

scholarly journals A European Emissions Trading System Powered by Distributed Ledger Technology: An Evaluation Framework

2021 ◽  
Vol 13 (4) ◽  
pp. 2106
Author(s):  
Rahel Mandaroux ◽  
Chuanwen Dong ◽  
Guodong Li
Keyword(s):  
Emissions Trading ◽  
Evaluation Framework ◽  
Eu Ets ◽  
The European Union ◽  
Trading System ◽  
Trading Systems ◽  
Distributed Ledger ◽  
Distributed Ledger Technology ◽  
Emissions Trading System ◽  
The Eu

The European Union Emissions Trading System (EU ETS) is a major pillar of the European energy policy to reduce greenhouse gas emissions. However, the reportedly pervasive frauds in this market are constraining the beneficial role of the EU ETS. In this conceptual paper, we propose to digitalize the EU ETS by distributed ledger technology (DLT), enabling the verification of authenticity and provenance, proof of ownership, and lifecycle traceability of carbon certificates and assets. Our platform allows verifiable credentials to validate emission allowances, real-time tracking of trading participants’ emissions, and the audit trail reporting of the decentralized trading records. Furthermore, we complement the DLT application concept with a structured interdisciplinary evaluation framework. Our framework and analysis aim to stimulate further interdisciplinary research in this area to support regulators, such as the European Commission, in designing effective digital emissions trading systems.

scholarly journals Price Relationships in the EU Emissions Trading System

2011 ◽  
pp. 212-220 ◽  
Author(s):  
Julien Chevallier
Keyword(s):  
European Union ◽  
Emissions Trading ◽  
Eu Ets ◽  
The European Union ◽  
Trading System ◽  
Trading Scheme ◽  
Price Relationships ◽  
Eu Emissions Trading System ◽  
Emissions Trading System ◽  
The Eu

The European Union Emissions Trading Scheme (EU ETS) constrains industrial polluters to buy/sell CO2 allowances depending on a regional depolluting objective of -8% of CO2 emissions by 2012 compared to 1990 levels. Companies may also buy carbon offsets from developing countries, funding emissions cuts there instead, under a Kyoto Protocol Clean Development Mechanism (CDM). This chapter critically analyzes the price relationships in the EU emissions trading system. The United Nations Framework Convention on Climate Change (UNFCCC) delivers credits that may be used by European companies for their compliance needs. Certified Emissions Reductions (CERs) from CDM projects are credits flowing into the global compliance market generated through emission reductions. EUAs (European Union Allowances) are the tradable unit under the EU ETS. Besides, the EU Linking Directive allows the import for compliance into the EU ETS up to 13.4% of CERs on average. This chapter details the idiosyncratic risks affecting each emissions market, be it in terms of regulatory uncertainty, economic activity, industrial structure, or the impact of other energy markets. Besides, based on a careful analysis of the EUA and CER price paths, this chapter assesses common risk factors by focusing more particularly on the role played by the CER import limit within the ETS.

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