The environmental ambition of an ETS may be assessed considering three dimensions: emissions coverage, stringency and determinacy.
Allowance prices are an imperfect metric for the stringency of an ETS. Yet, arguably, they are the best proxy for ETS stringency.
Beyond the partial equilibrium representation of linking, a range of economic and political factors can diminish a jurisdiction’s willingness or ability to link.
When choosing a linking partner, many factors are weighed up which transcend the compatibility of ETS designs and differences in environmental ambition.
Linkages between absolute- and relative-cap ETSs are problematic in that overall emissions may increase.
In the literature, non-cooperative linking most often leads to higher emissions than if the same ETSs operated under autarky.
There is a shortage of studies simulating the economic impacts of linkages between existing ETSs. More work is also needed to identify the desirable content of future linking agreements.
On 19th March 2020, the European Commission adopted a Temporary Framework for State Aid measures, which is based on Article 107(3)(b)TFEU and complements other possibilities available to Member States to [...]
In 2020, the Florence School of Regulation (FSR) published a comprehensive study peer reviewing major analyses in the area of energy decarbonisation with the aim of giving a coherent interpretation [...]
This report was prepared to inform the Carbon Market Policy Dialogue (CMPD) between the European Commission, as the regulator of the EU Emissions Trading System, and the regulatory authorities for [...]
EU gas and electricity prices have increased rapidly over the last few months and reached unprecedented levels. While the recent energy price dynamics reflect current market conditions and have little [...]