Mission Impossible!? On the Harmonization of National Allocation Plans Under the EU Emissions Trading Directive
30 Pages Posted: 20 May 2004 Last revised: 14 Aug 2008
Date Written: 2004
Abstract
Starting in 2005, the EU will implement a CO2 emissions trading scheme. In this paper we show that the outspoken goals of economic efficiency and free allocation of allowances are incompatible with harmonized allocation rules. In general, the assignment of allowances is endogenous and differs widely across countries, thereby substantiating concerns for implicit state aid and competitive distortions. We discuss potential adjustments to the Directive in order to allow for harmonization, i.e. for identical assignment factors to similar firms located in different EU countries.
Keywords: Emissions trading, allowance allocation, national allocation plan, competitive distortions
JEL Classification: D58, H21, H23, Q50, Q58
Suggested Citation: Suggested Citation
Do you have negative results from your research you’d like to share?
Recommended Papers
-
Assessing Emission Allocation in Europe: An Interactive Simulation Approach
By Christoph Böhringer, Tim Hoffmann, ...
-
Emission Trading Beyond Europe: Linking Schemes in a Post-Kyoto World
By Niels Anger
-
Hot Air for Sale: A Quantitative Assessment of Russia's Near-Term Climate Policy Options
By Christoph Böhringer, Ulf Moslener, ...
-
Efficiency Losses from Overlapping Economic Instruments in European Carbon Emissions Regulation
By Christoph Böhringer, Henrike Koschel, ...
-
Reducing Deforestation and Trading Emissions: Economic Implications for the Post-Kyoto Carbon Market
By Niels Anger and Jayant Sathaye
-
By Niels Anger, Alistair Dixon, ...