EU ETS-broken beyond repair ? An analysis based on FASTER principles
Résumé
The EU ETS is one of the main European climate policies, covering 45 percent of EU’s greenhouse gas
emissions. Its main goal is to limit emissions cost-effectively, and to trigger innovations using a strong price
signal, making low-carbon technologies more competitive. While emissions reduction targets for 2020 have
already been achieved, the exact role of the ETS in this success remains controversial. The assessment is
crucial, as more and more countries and regions plan to adopt similar policies to achieve their targets expressed
in the Intended Nationally Determined Contributions, communicated at the Paris Conference of the Parties. The
EU ETS, as the longest running and largest carbon market in the world, will undoubtedly serve as a point of
reference.
This paper attempts to provide a comprehensive analysis of the policy. First part outlines the historical
development of emission trading systems, as well as the development of the EU ETS since its inception in 2005.
Second part uses FASTER principles developed by the World Bank and the OECD to perform a multi-criteria,
qualitative analysis of the EU ETS in its current form. Third part concentrates on the upcoming revision for the
fourth phase, evaluating whether the proposals correctly address the policy’s shortcomings. It also provides some
alternative reform proposals.
Domaines
Economies et finances
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wp2017-24.-euetsbrokenbeyondrepair-xtimbeau.pdf (760.59 Ko)
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