Linking the EU Emissions Trading Scheme to JI, CDM and Post-2012 International Offsets - A Legal Analysis and Critique of the EU ETS and the Proposals for its Third Trading Period

Sépibus, Joëlle de

doi:10.2139/ssrn.1283523

Cited by 4 publications

(2 citation statements)

References 22 publications

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“…In 2004, the EU linking directive established the possibility to use the Kyoto credits in the EU-ETS without any limit. During the second Phase of emission trading, the EU Commissions introduced quantitative and qualitative restrictions on the use of these offsets 2 (de Sépibus, 2008). This revision was meant to avoid a price collapse, as observed during the first Phase.…”

Section: Introductionmentioning

confidence: 99%

Do technology externalities justify restrictions on emission permit trading?

Cian

Tavoni

2012

Resource and Energy Economics

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a b s t r a c tInternational emission trading is an important flexibility mechanism, but its use has been often restricted on the ground that access to international carbon credits can undermine the domestic abatement effort reducing the incentive to innovate and, eventually, lowering the pace of climate policy-induced technological change. This paper examines the economics that is behind these concerns by studying how a cap to the trade of carbon offsets influences innovation, technological change, and welfare. By using a standard game of abatement and R&D, we investigate the main mechanisms that shape these relationships. We also use a numerical integrated assessment model that features environmental and technology externalities to quantify how limits to the volume, the timing, and the regional allocation of carbon offsets affect climate policy costs and the incentive to invest in innovation and lowcarbon technologies.Results indicate that, for moderate caps on the amount tradable emissions permits and sufficiently high technology spillovers, global innovation and technical change would increase and that this additional innovative effort could lead to economic efficiency gains. The numerical analysis confirms that when constraints are close ଝ This paper is part of the research carried out by the Sustainable Development Programme of Fondazione Enrico Mattei. Financial contribution from the PLANETS project funded by the European Commission under the 7th framework programme is gratefully acknowledged. The usual disclaimer applies. We would like to especially thank Prof. Sjak Smulders for the many comments and suggestions which have helped to considerably improve this manuscript.*

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Section: Introductionmentioning

confidence: 99%

Do technology externalities justify restrictions on emission permit trading?

Cian

Tavoni

2012

Resource and Energy Economics

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“…3 de Sepibus (2008), page 8. For an annotated bibliography of all sources referenced in this paper, see Appendix A.…”

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confidence: 99%

Assessing the Potential of Climate Offset Programs

Hahn

Giovanni

2010

SSRN Journal

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Environmental Offset Programs: Survey and Synthesis

Hahn

Richards²

2010

SSRN Journal

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In the real world, taxes and cap-and-trade systems are rarely implemented in their pure form. In this paper, we examine a related approach that has been used widely in practice -which we refer to as an "offset." The idea behind offsets is to encourage firms or entities that may not be a part of the main regulatory system to produce environmental improvements, which can then be used to offset pollution reduction requirements in the main regulatory system. This paper provides a survey and synthesis of the literature on the use of offsets. Examples include offsets for limiting greenhouse gas emissions, maintaining ecosystem services for wetlands, achieving local air pollution goals, protecting water quality, and promoting energy efficiency. The paper reviews how offsets are used in practice and examines what is known about their environmental and economic impacts.Combining insights from the political economy of using offsets with their intrinsic design challenges raises a potentially serious problem -namely, that offsets may often fail to take adequate account of environmental or ecosystem damages. Because this problem can be significant, alternatives should be considered.

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Linking the EU Emissions Trading Scheme to JI, CDM and Post-2012 International Offsets - A Legal Analysis and Critique of the EU ETS and the Proposals for its Third Trading Period

Cited by 4 publications

References 22 publications

Do technology externalities justify restrictions on emission permit trading?

Do technology externalities justify restrictions on emission permit trading?

Assessing the Potential of Climate Offset Programs

Environmental Offset Programs: Survey and Synthesis

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