Year: 2019
Type: article
Abstract: An anatomy identifies four main components of actual or proposed Emissions Trading Systems (ETS): (1) Pursued policy goals with the ETS instrument; (2) Public authority allocations of permits to the regulated participants; (3) Carbon emissions price levels; and (4) Participants’ abatement expenses dependent on the ready availability of affordable abatement techniques or of low-carbon innovation opportunities. These components cover a range of options. A different assemblage of options delivers different ETS exemplars. Two main exemplars are identified. The actual EU ETS is highly successful in meeting the goal of low financial burdens on EU industry, thereby precluding carbon leakage. The other exemplar opts for high carbon emissions prices in the EU to induce industrial innovations towards a low-carbon economy. Incumbent industrial interests oppose this exemplar. Contrary to current policy discourse and to wishful proposals, both ETS exemplars cannot co-exist. ETS anatomy offers insight and structure for thorough analysis and evaluation of existing ETS, resulting in context–specific and appropriate designs of the carbon trading systems.
Source: Environmental Science & Policy
Authors: Aviel Verbruggen, Erik Laes, Edwin Woerdman
Institutions: University of Antwerp, University of Groningen
Language: English
Subfield: Economics and Econometrics
Domain: Social Sciences
SDG: Climate action
Open Access status: hybrid
Estimated APC paid: $3,550
OpenAlex ID: W2944538100