Price relationships in the EU emissions trading system
Chevallier, Julien (2011), Price relationships in the EU emissions trading system, in Luo, Zongwei, Green Finance and Sustainability : Environmentally-Aware Business Models and Technologies, IGI Global, p. 212-220
External document linkhttp://halshs.archives-ouvertes.fr/halshs-00458728/fr/
Book titleGreen Finance and Sustainability : Environmentally-Aware Business Models and Technologies
Book authorLuo, Zongwei
Number of pages568
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Abstract (EN)The Emissions Trading Scheme (ETS) constrains industrial polluters to buy/sell CO2 allowances depending on a regional depolluting objective of -8% of CO2 emissions by 2012 compared to 1990 levels. Companies may also buy carbon offsets from developing countries, funding emissions cuts there instead, under a Kyoto Protocol Clean Development Mechanism (CDM). This article critically analyzes the price relationships in the EU emissions trading system. The United Nations Framework Convention on Climate Change (UNFCCC) delivers credits that may be used by European companies for their compliance needs. Certified Emissions Reductions (CERs) from CDM projects are credits flowing into the global compliance market generated through emission reductions. EUAs (EU Allowances) are the tradable unit under the EU ETS. Besides, the EU Linking Directive allows the import for compliance into the EU ETS up to 13.4% of CERs on average. This article details the idiosyncratic risks affecting each emissions market, be it in terms of regulatory uncertainty, economic activity, industrial structure, or the impact of other energy markets. Besides, based on a careful analysis of the EUA and CER price paths, we assess common risk factors by focusing more particularly on the role played by the CER import limit within the ETS.
Subjects / KeywordsEmissions Markets; Greenhouse Gases Reductions; EU Emissions Trading Scheme; Clean Development Mechanism; Kyoto Protocol; EU ETS; CDM
Showing items related by title and author.
The EU emissions trading scheme : The effects of industrial production and CO2 emissions on carbon prices Alberola, Emilie; Chevallier, Julien; Chèze, Benoît (2008) Article accepté pour publication ou publié