Partner Publications

German Marshall Fund

A series of ‘Lessons learnt from the EU ETS’ disseminations in North America extends previous Climate Strategies research with a focus adopted to optimize the contribution to the policy dialogue in the U.S. The purpose is to make readily available the results of previous and new Climate Strategies research on the EU experience with the ETS to U.S. audiences.
Further information on GMF: Climate & Energy Paper Series.

Climate Policy and Industrial Competitiveness: : Ten Insights from Europe on the EU Emissions Trading Scheme (July 2009): The report focuses specifically on international competitiveness and carbon leakage issues in key industries.

DECC

Global Carbon Trading: A framework for reducing emissions (July 2009): A report commissioned by the Prime Minister, Gordon Brown, concludes that a global carbon trading network is vital to preventing dangerous climate change.

Global Carbon Market Institutions (July 2009): Our research provided a background paper that was used to inform the report. This paper identifies governance challenges in a global carbon market, groups these in systematic categories, and proposes institutional functions for their adequate regulation.

Tackling Carbon Leakage: DECC published a study by Climate Strategies, Cambridge Econometrics and Entec UK. The study looked at the impact of an increased EU greenhouse gas reduction target on the risk of carbon leakage. The study shows that for those sectors studied, a move to increase the EU’s 2020 greenhouse gas reduction target from 20% to 30% would not significantly reduce EU output. (The report can be viewed here)
EU ETS News 
EU ETS Publications and Research

infoDEV

Office of Climate Change

Climate Change: Financing Global Forests - The Eliasch Review
The Eliasch Review is an independent report to government, commissioned by the Prime Minister and prepared by Johan Eliasch with the support of the Office of Climate Change. The Review aims to provide a comprehensive analysis of international financing to reduce forest loss and its associated impacts on climate change. It does so with particular reference to the international efforts to achieve a new global climate change agreement in Copenhagen at the end of 2009.

Scaling Up AFOLU Mitigation Activities in Non Annex 1 Countries (Jun 2008): This  report  is  designed  to  inform  the  Review  on  the  potential  to  streamline  or  scale‐up  the  certification  process  for  mitigation  through  sequestration  activities  and  to  provide  transferable  lessons  for  how  to  design  an  effective  certification  mechanism  for  the  mitigation  of  emissions  through  reduced  deforestation.

Carbon Trust

Our research also provided key insight for the UK’s Carbon Trust, the organization established jointly between UK government and business to help move the UK to a low carbon economy. Carbon Trust Insights publications are targeted at a business constituency and have drawn increasingly upon Climate Strategies research particularly in explaining the EU ETS and making the case for a stronger system over time.

Tackling carbon leakage - Sector-specific solutions for a world of unequal prices (Mar 2010)
EU ETS incentives and curbs on emissions have the potential to reduce competitiveness of heavy emitting UK businesses leading to both emissions and economic activity 'leaking' to non-EU producers. Although the risks of leakage to the UK economy have been found to be relatively small in a number of studies, the potential risk is greater for a few key sectors. Building on earlier competitiveness and carbon leakage work by Climate Strategies this report presents sector specific solutions to guard against the problem of leakage in the Aluminum, Steel and Cement sectors. 

Linking emission trading systems - Prospects and issues for business (Sep 2009) With the establishment of a global carbon market now a major policy goal worldwide, the ‘Linking emission trading systems’ report, examines the issues for business and the practicalities of its development. The report analyses the key barriers to linking both emerging and existing systems and presents a potential timeline for the creation of a global company-level carbon market. The findings should be of interest to businesses operating across multiple regions, to policy makers preparing for international negotiations or developing cap and trade systems and to those wanting to stay at the forefront of issues facing cap-and-trade systems.

Global Carbon Mechanisms: emerging lessons and implications (Dec 2008) sets out to explain the developments of mechanisms that give companies – and countries – incentives to reduce emissions internationally; presents the lessons from the emerging experience; and to answer what it implies for the future.The overall evaluation is intended to include a fast-track analysis of the impact of fossil fuel prices and the economic downturn on the likely demand for Kyoto credits and allowances.

Executive Summary

Global Carbon Mechanisms Annex I: Analysis of CDM project performance
This note builds on analysis of the publicly available data on the CDM; in particular from the United Nations; Environment Programme’s Risoe database of CDM projects (‘the Risoe database’) and from theUnited Nations Framework Convention on Climate Change’s (‘UNFCCC’) website. it highlights in-depth case studies of the three countries most active in the CDM: China, India and Brazil; and also interviews with international experts and project developers. 

Global Carbon Mechanisms Annex II: Emissions and demand projections to 2020
This note builds on modelling by Cambridge Econometrics commissioned by the Carbon Trust and a survey of emission projections and data for the areas beyond the scope of the Cambridge Econometrics analysis. It highlights estimates of emissions in relation to Kyoto targets and ETS caps up to 2012 for the EU-15, the new member states of the EU, Japan, and the other Annex 1 countries, and also highlights work on projections beyond 2012 for the EU ETS and gaps where future work is required. 

Cutting Carbon in Europe The 2020 plans and the future of the EU ETS (June 2008) described the EC package particularly in relation to the proposals for the future of the EU ETS; the implications for business; and considers a range of complexities that have yet to be fully addressed.

EU ETS impacts on profitability and trade (Jan 2008) summarized extensive research into competitiveness and made the case that potential problems were confined to a few specific sectors, not the wider economy, and that tailored solutions could be developed for these sectors without needing to compromise on the strength of the EU ETS in Phase III.

EU ETS Phase II allocation: implications and lessons (2007) explained and defended the Commission’s interventions to toughen up allocation in Phase II, that had been prompted in part by Climate Strategies research on the draft plans.

Allocation and competitiveness in the EU ETS (2006) set out the benefits of emissions trading along with the drawbacks of excessive free allocation and the case for moving towards enhanced auctioning.

These reports have proved to be vehicles for wider communication of Climate Strategies research findings, and have strengthened the government’s hand in pushing for a tougher EU ETS in part by fostering more broad-based support in UK business for stronger action on climate change.