scholarly journals The importance of the Market Stability Reserve (MSR) for the reform of the CO2 emission allowance trading system

2018 ◽  
Vol 21 (3) ◽  
pp. 111-122
Author(s):  
K. Piwowarczyk-Ściebura
Keyword(s):  
Co2 Emission ◽  
Trading System ◽  
Emission Allowance ◽  
Market Stability ◽  
Allowance Trading

scholarly journals Reform des EU-Emissionshandels: Eine Alternative zu Mindestpreisen für Zertifikate und der Marktstabilitätsreserve

2015 ◽  
Vol 64 (2) ◽  
Author(s):  
Mark A. Andor ◽  
Manuel Frondel ◽  
Stephan Sommer
Keyword(s):  
Emission Trading ◽  
Emission Trading System ◽  
Trading System ◽  
Rule Based ◽  
The Past ◽  
Market Stability ◽  
Minimum Price ◽  
Single Intervention ◽  
Price Floor

AbstractIn Europe’s Emission Trading System (ETS), prices for emission permits have remained low for many years now. This fact gave rise to controversies on whether there is a need for fundamentally reforming the ETS. Potential reform proposals include the introduction of a minimum price for certificates and a market stability reserve (MSR). This is a rule-based mechanism to steering the volume of permits in the market. While preparing the introduction of this instrument, the European Commission hopes to be able to increase and stabilize certificate prices in the medium- and long-term. In this article, we recommend retaining the ETS as it is, rather than supplementing it by introducing a minimum price floor or a market stability reserve. Instead, mistakes from the past should be corrected by a single intervention: the final elimination of those 900 million permits that were taken out of the market in 2014, but would again emerge in the market in 2019 and 2020 (backloading).

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