| Title |
Prekybos apyvartiniais taršos leidimais sistemos ekonominio efektyvumo didinimas: paskirstymo metodų įtaka / |
| Translation of Title |
Improvements of economic effectiveness of the European emission trading scheme: influence of allocation methods. |
| Authors |
Čiegis, Remigijus ; Bubnienė, Rūta |
| DOI |
10.15388/Ekon.2006.17556 |
| Full Text |
|
| Is Part of |
Ekonomika.. Vilnius : Vilniaus universiteto leidykla. 2006, t. 73, p. 19-33.. ISSN 1392-1258. eISSN 2424-6166 |
| Keywords [eng] |
Emission trading |
| Abstract [eng] |
The aim of the emission trading system is to reduce emissions at the least cost to the economy and to bring environmental and economic benefits. Although the emission trading theory claims that the methodology of allocation under the conditions of a perfect market does not influence the effectiveness of the emission trading system, analysis of the Emission Trading Scheme of the European Union (EU ETS) has showed a link between the methodology chosen and its effectiveness. The article analyses the impact of the grandfathering, benchmarking and auction allocation methods on the effectiveness of the EU ETS. The article presents a comparative analysis of the national allocation plans of the EU Member States and discusses the potential demand for the allowances in the market. The implementation of the EU ETS showed that the primary and secondary market of the emissions' allowances will be highly influenced by the allocation methods applied by the EU Member States. In theory, however, in the perfect market of allowances, the market depends on the price of the allowances only. The variety of methods applied on micro and macro levels leads to market distortions. Only a few countries have used the auctioning option to distribute the allowance, while the majority of the countries allocated the allowances for free through grandfathering and benchmarking. Due to surpluses of allowances in the EU New Member States it is likely that there will be a general surplus of allowances within the EU ETS. This precondition implies a low price of the allowances and a little liquidity of the market. The surplus of allowances and windfall profit of the electricity producers decrease the effectiveness of the system, although, following the theory of the emission trading, the price of the allowance shall be equal to the marginal emission reduction costs. In practice, the marginal costs will be lower than the price of the allowances due to the surplus of the allowances... |
| Published |
Vilnius : Vilniaus universiteto leidykla |
| Type |
Journal article |
| Language |
Lithuanian |
| Publication date |
2006 |
| CC license |
|
