CO2 Prices, Energy and Weather
33 Pages Posted: 13 Jul 2006 Last revised: 30 Nov 2013
One of the main objectives of the European Union Emission Trading Scheme is the establishment of a market price for allowances that show to European CO2 emitting installations the environmental impact of their polluting activities. The aim of this paper is to study the effect of those weather and non-weather variables that academic and market agents consider as the major determinants of CO2 prices. The results show that the most emission intensive energy sources are the principal factors in the determination of CO2 prices, and that only extreme temperatures influence them.
Keywords: CO2 prices, EU ETS, Energy, Kyoto Protocol, Weather
JEL Classification: Q49, G12, G15
Suggested Citation: Suggested Citation