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The evolution of emissions trading in the EU: tensions between national trading schemes and the proposed EU Directive

journal contribution
posted on 2023-06-08, 00:14 authored by Steven SorrellSteven Sorrell, C Boemare, P Quirion
The EU is pioneering the development of greenhouse gas emissions trading, but there is a tension between the ‘top-down’ and ‘bottom-up’ evolution of trading schemes. While the Commission is introducing a European emissions trading scheme (EU ETS) in 2005, several member states have already introduced negotiated agreements that include trading arrangements. Typically, these national schemes have a wider scope than the proposed EU directive and allow firms to use relative rather than absolute targets. The coexistence of ‘top-down’ and ‘bottom-up’ trading schemes may create some complex problems of policy interaction. This paper explores the potential interactions between the EU ETS and the negotiated agreements in France and UK and uses these to illustrate some important generic issues. The paper first describes the proposed EU directive, outlines the UK and French policies and compares their main features to the EU ETS. It then discusses how the national and European policies may interact in practice. Four issues are highlighted, namely, double regulation, double counting of emission reductions, equivalence of effort and linking trading schemes. The paper concludes with some recommendations for the future development of UK and French climate policy.

History

Publication status

  • Published

Journal

Climate Policy

ISSN

1469-3062

Publisher

Elsevier

Issue

2

Volume

3

Page range

S105-S124

Pages

20.0

Department affiliated with

  • SPRU - Science Policy Research Unit Publications

Full text available

  • No

Peer reviewed?

  • Yes

Legacy Posted Date

2012-02-06

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