Emission trading has become recently more and more import in environmental regulation. In the context of controlling greenhouse gas emissions, the directive on a Europewide trading scheme for large immobile sources may be perceived as one of the most important milestones in recent years. Prior...

The paper analyzes the problem of achieving a target path of emission reductions in the electricity sector, using a scheme of tradable green certificates (TGC). There are two types of generation, renewable and fossil. The latter causes the emissions. The paper also examines effects from emission...

Instruments chosen to pursue climate related targets are not always efficient. In this paper we consider an economy with three climate related targets for its electricity generation: a given share of "green" electricity, a given expansion of "green" electricity, and a given reduction of "black"...

We examine the differential effects of using taxes and tradable permits to regulate emissions in an economy with financial frictions. We construct a two-sector model, where the regulated sector output is produced by entrepreneurs who differ in their endowment of managerial skills and assets and...

Motivated by the initiation of the third EU ETS trading period in January 2013, this paper examines the effects of EUA price variations on the electricity mix. We focus on the German electricity market, since it is one of the most important EU electricity markets. In this context, we formulate a...

After recalling to which extent the inefficiencies emerged during the Emissions Trading Scheme past trading periods are related to its institutional framework, as defined by the Directive 87/2003/EC, this article focuses on the major provisions of the 2008 European Commission Proposal for a new...

This paper investigates the causal effect of the European Union's Emissions Trading Scheme (EU ETS) on pollution abatement investments, relying on firm-level panel data from the French manufacturing industry between 2001 and 2016. First, I find that regulated firms increased their investments...

With the increase of the linear reduction factor (LRF), the implementation of the market stability reserve (MSR) and the introduction of the cancellation mechanism (CM), the EU ETS changed fundamentally. We develop a discrete time model of the intertemporal allowance market that accurately...

Das oberste klimapolitische Ziel der EU ist die vollständige Dekarbonisierung der Wirtschaft ihrer Mitgliedsstaaten bis 2050, d. h. die Klimaneutralität in allen Sektoren, die derzeit noch von fossilen Brennstoffen abhängig sind. Dies spiegelt sich in der politischen Agenda der EU-Kommission...

This paper provides a first estimate of the potential greenhouse gas mitigation from the intra-sector reallocation of economic activity by the European manufacturing industry away from carbon-inefficient - or "brown zombie" - firms to more carbon-efficient firms. Using techniques from the...