ETSs with different measures for carbon leakage prevention: implications for linking

Title

ETSs with different measures for carbon leakage prevention: implications for linking

Author(s)

Stefano F. Verde, Giulio Galdi, Simone Borghesi, Jürg Füssler, Ted Jamieson, Martin Soini, Emily Wimberger and Li Zhou

Organisation

European University Institute

Year

September 2021

Type

Study

Length

30 p.

Keywords

Carbon leakage, Innovation Fund, Investments

Abstract

This report was prepared to inform the Carbon Market Policy Dialogue (CMPD) between the European Commission, as the regulator of the EU Emissions Trading System, and the regulatory authorities for the emissions trading systems (ETSs) of California, Quebec, China, New Zealand and Switzerland. The report deals with the implications of linking emissions trading systems (ETSs) that differ from each other in the measures for carbon leakage prevention. The report provides a conceptual framework and summarizes the relevant scientific literature; it describes the current status of the six ETSs represented in the CMPD and, finally, it offers up a few ideas for discussion.