scholarly journals Ratcheting Up Carbon Trade: The Politics of Reforming EU Emissions Trading

2017 ◽  
Vol 17 (2) ◽  
pp. 105-124 ◽  
Author(s):  
Torbjørg Jevnaker ◽  
Jørgen Wettestad
Keyword(s):  
Greenhouse Gas ◽  
Climate Policy ◽  
Emissions Trading ◽  
Carbon Price ◽  
European Parliament ◽  
Carbon Markets ◽  
Trading System ◽  
Trading Systems ◽  
Emissions Trading System ◽  
The Eu

The EU’s emissions trading system (ETS) covers almost half of its greenhouse gas emissions and has been hailed as the cornerstone and flagship of EU climate policy. In spring 2013, however, the ETS was in severe crisis, with a huge surplus of allowances and a sagging carbon price. Even a formally simple measure to change the timing of auctioning was initially rejected by the European Parliament. Two years later, a much more important, quantity-focused “market thermostat” (the market stability reserve) was adopted, and proposals for a complete ETS overhaul were put on the table. This article examines how it was possible to turn the flagship around so quickly, providing insights into the mechanisms for gradually rendering emissions trading systems more effective. Crucial changes at the EU and national levels are identified, chief among them changes in Germany and in the European Parliament. Furthermore, the quantity-based tightening mechanism discussed could be of relevance for carbon markets outside Europe.

scholarly journals Rescuing EU Emissions Trading: Mission Impossible?

2014 ◽  
Vol 14 (2) ◽  
pp. 64-81 ◽  
Author(s):  
Jørgen Wettestad
Keyword(s):  
Emissions Trading ◽  
Carbon Price ◽  
Reduction Factor ◽  
Low Carbon ◽  
Short Term ◽  
Trading System ◽  
International Policy ◽  
Science Theory ◽  
Emissions Trading System ◽  
The Eu

Is rescuing the EU's emissions trading system impossible? Despite the substantial reform in 2008, subsequent problems of allowance surplus and a low carbon price have spurred new efforts to reform the system for the 2013–2020 phase. But these efforts have met resistance both among member states and in the European parliament, and the EU is struggling in its efforts to improve the ETS. This article draws on four central EU and political science theory approaches to more systematically explore why. The financial crisis and slow international policy progress have narrowed the window of opportunity that was open in 2008. Factors that could open that window again include an economic upswing, a new European commission and parliament, and new global negotiations in 2015. But even without short-term reform, the linear reduction factor will gradually tighten the system and lead to a higher carbon price.

Market-based Climate Policy in China? The Case of Emissions Trading Systems

2019 ◽  
Vol 11 (04) ◽  
pp. 46-59
Author(s):  
Erik BAARK
Keyword(s):  
Climate Change ◽  
Climate Policy ◽  
Carbon Emissions ◽  
Emissions Trading ◽  
Chinese Government ◽  
Negative Consequences ◽  
Trading System ◽  
Political Issues ◽  
Trading Systems ◽  
Emissions Trading System

China recognises the need to reduce carbon emissions in order to avoid negative consequences from climate change in the future. Therefore, the Chinese government initiated seven emissions trading system (ETS) pilots in 2013 and began to develop China’s national ETS in 2017. However, Chinese efforts to implement ETS have encountered legal, institutional and political issues that must be solved so that a national ETS could help to mitigate emissions in China.

scholarly journals Implementing the EU Climate Law via the ‘Fit for 55’ package

2022 ◽  
Vol 1 (1) ◽  
Author(s):  
Sabine Schlacke ◽  
Helen Wentzien ◽  
Eva-Maria Thierjung ◽  
Miriam Köster
Keyword(s):  
Greenhouse Gas ◽  
Emissions Trading ◽  
Legal Status ◽  
Legal Framework ◽  
The European Union ◽  
Trading System ◽  
Greenhouse Gas Reduction ◽  
Eu Emissions Trading System ◽  
Emissions Trading System ◽  
The Eu

ABSTRACT To implement the European Union (EU) Climate Law’s newly established 55% greenhouse gas reduction objective for 2030, the EU Commission suggests a wave of reforms to the European energy and climate legislation. The contribution aims to describe the EU Commission’s 16 initial legislative and strategic proposals regarding the major pillars of the European energy and climate legislation and intends to give an overview on the suggested reforms. By comparing the legal status quo with the legal framework de lege ferenda as presented by the Commission’s proposals, the planned major changes to the legal structures are identified. To achieve the 55% greenhouse gas reduction objective for 2030, all existing legal climate and energy acts are planned to be tightened by amending their targets as well as scopes and revising their structures. The suggested reforms concern the existing EU emissions trading system, effort sharing system between the Member States, energy taxation, energy efficiency and renewable energies. Additionally, the implementation of new instruments, such as the second EU emissions trading system for the sectors buildings and transport, the Carbon Border Adjustment Mechanism and the Social Climate Fund, is proposed. The design of the package shows that the Commission still generally pursues a climate legislation characterized by a mix of instruments and policies being both price based and regulatory. So, even though the major proposed change—the introduction of a second separate emissions trading system—would strengthen the role of carbon pricing, the Commission still relies on a mix of instruments without defining a leading instrument.

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 Analysis of the Influence of the European Parliament and the Council of the EU Exemplified by the EU Emissions Trading System Reform

2021 ◽  
Vol 65 (6) ◽  
pp. 21-32
Author(s):  
N. Kaveshnikov
Keyword(s):  
Emissions Trading ◽  
European Parliament ◽  
Legislative Process ◽  
Trading System ◽  
Member States ◽  
Eu Emissions Trading System ◽  
Final Text ◽  
Emissions Trading System ◽  
The Eu

Received 28.12.2020. The article examines the comparative influence of the Council of the European Union and the European Parliament in the ordinary legislative procedure using the example of the EU Emissions Trading System (ETS) reform. The study was carried out on the basis of a process tracing method. Primary data includes documents reflecting positions of the actors (summary of consultations, position papers, statements) and the progress of the legislative process (Commission proposal, EP amendments, discussions in the Council, final text of the directive). In total, 21 important elements of the reform were analysed, on which the positions of the European Parliament and the Council diverged significantly. The following conclusions are made. 1) The case study provides a relevant example of the consensual nature of the EU decision-making. 2) The case study confirms that the essence of the legislative process in the EU is not a confrontation, but an faithful cooperation of both co-legislators. 3) The Commission and both co-legislators were significantly limited by the decision of the European Council, which fixed most of the basic parameters of the ETS phase IV. This corresponds to the trend of new intergovernmentalism. 4) The study of comparative influence of both co-legislators on the final text of the directive demonstrates that the member states played a decisive role in the ETS reform, and the final provisions of the directive reflect primarily the balance of interests and influence in the Council. The study shows how the interests of certain groups of the EU member states, in particular of CEE countries, were taken into account. The influence of the European Parliament on the legislative process is greater than that of individual countries, even the biggest ones, but it is no more than a quarter of the influence of the Council as an actor. 5) The study identifies a number of factors that enable the European Parliament to uphold its position more effectively. Acknowledgments. The article has been supported by the Institute of International Studies of the MGIMO-University. Project No. 2022-02-01.

Sign in / Sign up

Export Citation Format

Share Document