Climate | Article
Installation entries and exits in the EU ETS : patterns and the delay effect of closure provisions
07 November 2022
BY: Stefano Verde, GRAF Christoph, JONG Thijs
Energy economics, 2019, Vol. 78, pp. 508-524
This paper analyses installation entries and exits in the EU ETS, over 2005–2013. Patterns of entries and exits are identified across countries, sectors, and time. The limitations of the EUTL as a data source for research purposes mean that only genuine exits (reflecting production capacity reduction), and not genuine entries (reflecting production capacity increases), can be systematically identified. Exits are found to be relatively frequent events, more so in manufacturing sectors with small average installation size. Moreover, exits were concentrated in 2007 and in 2012, the final years of Phase I and Phase II. We investigate whether the perverse incentives of closure provisions, in free allocation, explain such time pattern. A discrete-time hazard model for the exit event is estimated using a three-tier dataset combining installation-, firm-, and macro-level information. The results indicate that, most likely, closure provisions delayed installation exits, especially in Phase II.
logo cadmus Read it on Cadmus Download in open access

LATEST FSR PUBLICATIONS

Working Paper
Having identified the basic characteristics of the current energy crisis and its particular shape in the European Union, three questions immediately arise. 1) If gas is at the ‘core’ of [...]
Technical Report
In this report we focus on the fundamentals of energy and climate policy as reformulated in the EU Green Deal. The 2022 edition includes updates following the publication of the [...]
Technical Report
Against the backdrop of the European Green Deal and the subsequent ‘Fit for 55’ Package, the basic infrastructures will have to become more sustainable over the course of their entire [...]
Other
Economic regulators of water and sanitation services (WSS) across Europe were originally established to address harmful consequences arising from the natural monopoly of the sector. This is reflected in their [...]
Other
The COVID-19 pandemic has almost forced the aviation industry to a halt in 2020, at least when it comes to the provision of passenger services: the number of active routes, [...]
Working Paper
We think that the electricity markets that were developed over the last two decades did what they were supposed to do during this crisis: through higher prices, they convey the [...]

Join our community

To meet, discuss and learn in the channel that suits you best.

scroll

top