Abatement and Allocation in the Pilot Phase of the EU ETS

21 Pages Posted: 12 Jun 2009 Last revised: 4 Aug 2010

Date Written: June 22, 2010

Abstract

We use historical industrial emissions data to assess the level of abatement and overallocation that took place across European countries during the pilot phase (2005-2007) of the European Union Emission Trading Scheme. Using a dynamic panel data model, we estimate the counter factual (business-as-usual) emissions scenario for EU member states. Comparing this baseline to allocated and verified emissions, we find that both overallocation and abatement occurred, along with under-allocation and emissions inflation. Over the three trading years of the pilot phase we find over-allocation of approximately 280 million EUAs and total abatement of 247 Mt CO2. However, we calculate that emissions inflation of approximately 73 Mt CO2 also occurred, possibly due to uncertainty about future policy design features.

Keywords: Emissions Trading Scheme, Climate Policy, Dynamic Panel Data Analysis

JEL Classification: C23, O13, Q54, Q58

Suggested Citation

Anderson, Barry J. and Di Maria, Corrado, Abatement and Allocation in the Pilot Phase of the EU ETS (June 22, 2010). FEEM Working Paper No. 110.2009, Available at SSRN: https://ssrn.com/abstract=1417962 or http://dx.doi.org/10.2139/ssrn.1417962

Corrado Di Maria (Contact Author)

University of East Anglia ( email )

Norwich Research Park
Norwich, Norfolk NR4 7TJ
United Kingdom
441603592866 (Phone)

No contact information is available for Barry J. Anderson

Do you have negative results from your research you’d like to share?

Paper statistics

Downloads
245
Abstract Views
1,326
Rank
226,986
PlumX Metrics