This paper analyses the role that companion policies have had in the reduction of emissions regulated by the EU Emissions Trading System (EU ETS) and the related policy interactions, with a view to identifying relevant insights for China's forthcoming Emissions Trading System (ETS). The investigation rests on: (a) the observation of the EU's and China's ETSs and policy mixes; (b) economic theory concerning companion policies and ETS design; and (c) empirical ex-post evidence from the EU ETS. Three main conclusions emerge from the analysis. First, China's ETS, while not imposing a fixed cap on emissions, will not be immune to waterbed effects of companion policies. Second, the European experience stresses the importance of making explicit the objectives pursued by companion policies, and of balancing policies for innovation and policies for adoption of low-carbon technologies. Third, in the presence of a major market surplus, only permanent adjustments to allowance supply can be effective in raising prices.
This article provides a fresh, interdisciplinary perspective on the European Union’s electricity market design (EMD) reform. In policy as well as in law, much of the literature on the EMD [...]
Interconnectors with third countries are currently outside the scope of the Electricity Directive and of the Electricity Regulation. Therefore, the provisions contained in these acts regarding third-party access and tariffs, [...]
The electrification of final energy uses is one of the key ingredients for any roadmap to a low-carbon energy system. In the EU, the European Commission has confirmed the relevance [...]
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