IDEAS home Printed from https://ideas.repec.org/p/pra/mprapa/14668.html
   My bibliography  Save this paper

Ways to improve the design of the EU emissions trading scheme: key issues and answers

Author

Listed:
  • Zhang, ZhongXiang

Abstract

The Europe Union is about to lunch the world’s first greenhouse gas emissions trading scheme in history. This represents an enormous challenge because there is no previous experience with such an unprecedented scheme, and because its final outcome might shape the design of future environmental market-based policies as well as the political viability of future efforts towards emissions reductions. There are five basic issues that not only will shape the final design of the scheme but also might hinder the performance of such a scheme, if not effectively addressed. They include universal vs. reduced scope, member country vs. European-wide sector objectives and allocations, allocation methodology and base year choice, energy mix and national security, and incentives for technological innovation. This paper aims to address these key issues to help to shape the final design of the scheme in a positive manner.

Suggested Citation

  • Zhang, ZhongXiang, 2004. "Ways to improve the design of the EU emissions trading scheme: key issues and answers," MPRA Paper 14668, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:14668
    as

    Download full text from publisher

    File URL: https://mpra.ub.uni-muenchen.de/14668/1/MPRA_paper_14668.pdf
    File Function: original version
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. ZhongXiang Zhang, 2003. "Open Trade with the U.S. without Compromising Canada’s Ability to Comply with its Kyoto Target," Working Papers 2003.68, Fondazione Eni Enrico Mattei.
    2. Manne, Alan & Richels, Richard, 2004. "US rejection of the Kyoto Protocol: the impact on compliance costs and CO2 emissions," Energy Policy, Elsevier, vol. 32(4), pages 447-454, March.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Zhang, ZhongXiang, 2009. "Encouraging developing country involvement in a post-2012 climate change regime: carrots, sticks or both?," MPRA Paper 13174, University Library of Munich, Germany.
    2. Stavins, Robert, 2004. "Can an Effective Global Climate Treaty be Based on Sound Science, Rational Economics, and Pragmatic Politics?," Working Paper Series rwp04-020, Harvard University, John F. Kennedy School of Government.
    3. ZhongXiang Zhang, 2013. "Trade in environmental goods, with focus on climate-friendly goods and technologies," Chapters, in: Geert Van Calster & Denise Prévost (ed.), Research Handbook on Environment, Health and the WTO, chapter 19, pages 673-699, Edward Elgar Publishing.
    4. Tol, Richard S.J., 2012. "A cost–benefit analysis of the EU 20/20/2020 package," Energy Policy, Elsevier, vol. 49(C), pages 288-295.
    5. ZhongXiang Zhang, 2012. "Climate Change Meets Trade in Promoting Green Growth: Potential Conflicts and Synergies," Chapters, in: Chin Hee Hahn & Sang-Hyop Lee & Kyoung-Soo Yoon (ed.), Responding to Climate Change, chapter 6, Edward Elgar Publishing.
    6. Quinn, Barry & Gallagher, Ronan & Kuosmanen, Timo, 2021. "Lurking in the Shadows: The Impact of Emissions Target Setting on Carbon Pricing and Environmental Efficiency," QBS Working Paper Series 2021/05, Queen's University Belfast, Queen's Business School.
    7. Keller, Klaus & Miltich, Louise I. & Robinson, Alexander & Tol, Richard S.J., 2007. "How Overconfident are Current Projections of Anthropogenic Carbon Dioxide Emissions?," Climate Change Modelling and Policy Working Papers 9321, Fondazione Eni Enrico Mattei (FEEM).
    8. Zhongxiang Zhang, 2011. "In what format and under what timeframe would China take on climate commitments? A roadmap to 2050," International Environmental Agreements: Politics, Law and Economics, Springer, vol. 11(3), pages 245-259, September.
    9. ZhongXiang Zhang, 2010. "The U.S. proposed carbon tariffs, WTO scrutiny and China’s responses," International Economics and Economic Policy, Springer, vol. 7(2), pages 203-225, August.
    10. Zhang, Zhong Xiang, 2012. "Competitiveness and Leakage Concerns and Border Carbon Adjustments," International Review of Environmental and Resource Economics, now publishers, vol. 6(3), pages 225-287, December.
    11. Bao, Qin & Tang, Ling & Zhang, ZhongXiang & Wang, Shouyang, 2013. "Impacts of border carbon adjustments on China's sectoral emissions: Simulations with a dynamic computable general equilibrium model," China Economic Review, Elsevier, vol. 24(C), pages 77-94.
    12. Zhang, ZhongXiang, 2009. "Multilateral trade measures in a post-2012 climate change regime? What can be taken from the Montreal Protocol and the WTO?," Energy Policy, Elsevier, vol. 37(12), pages 5105-5112, December.
    13. Fubing Su & Ran Tao & Hui Wang, 2013. "State Fragmentation and Rights Contestation: Rural Land Development Rights in China," China & World Economy, Institute of World Economics and Politics, Chinese Academy of Social Sciences, vol. 21(4), pages 36-55, July.
    14. Olmstead, Sheila M. & Stavins, Robert N., 2009. "An Expanded Three-Part Architecture for Post-2012 International Climate Policy," Working Paper Series rwp09-036, Harvard University, John F. Kennedy School of Government.
    15. D’Amato, Alessio & Valentini, Edilio & Zoli, Mariangela, 2017. "Tradable quota taxation and market power," Energy Economics, Elsevier, vol. 63(C), pages 248-252.
    16. Zhang, ZhongXiang, 2009. "Liberalizing climate-friendly goods and technologies in WTO environmental goods negotiations: product coverage, modalities, challenges and the way forward," MPRA Paper 16943, University Library of Munich, Germany, revised 10 Aug 2009.
    17. Onno J. Kuik & Barbara Bucher & Michela Catenacci & Etem Karakaya & Richard S.J. Tol, 2006. "Methodological aspects of recent climate change damage cost studies," Working Papers FNU-122, Research unit Sustainability and Global Change, Hamburg University, revised Dec 2006.
    18. Tol, Richard S.J., 2013. "Targets for global climate policy: An overview," Journal of Economic Dynamics and Control, Elsevier, vol. 37(5), pages 911-928.
    19. Medalla, Erlinda M. & Lazaro, Dorothea C., 2005. "Does Trade Lead to a Race to the Bottom in Environmental Standards? Another Look at the Issues," Discussion Papers DP 2005-23, Philippine Institute for Development Studies.
    20. Kemfert, Claudia & Zhang, ZhongXiang, 2003. "Linking developing country's cooperation on climate control with industrialized country's R&D and technology transfer," MPRA Paper 41473, University Library of Munich, Germany.

    More about this item

    Keywords

    EU emissions trading scheme; Allowance allocations; Carbon price; Energy mix; Technological innovation; Competitiveness concerns;
    All these keywords.

    JEL classification:

    • Q52 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Pollution Control Adoption and Costs; Distributional Effects; Employment Effects
    • Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy
    • Q42 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Alternative Energy Sources
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:14668. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Joachim Winter (email available below). General contact details of provider: https://edirc.repec.org/data/vfmunde.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.