Differentiation and dynamics of competitiveness impacts from the EU ETS

Misato Sato, Michael Grubb, James Cust, Katie Chan, Anna Korppoo and Pablo Ceppi

Cambridge Working Papers in Economics from Faculty of Economics, University of Cambridge

Abstract: We summarises the main factors that differentiate impacts of the EU ETS on profitability and market share. By examining sampling a range of sectors, we present some simple metrics and indicators to help judge the nature of potential impacts. We also consider briefly the mitigation response to these impacts by sectors, and how they may evolve over time. The broad conclusion confirms the aggregate findings presented in the existing literature - most participating sectors are likely to profit under the current ETS structure out to 2012 at the cost of a modest loss of market share, but this may not hold for individual companies and regions. The period 2008-12 can assist participating sectors to build experience and financial reserves for longer term technology investments and diversification, providing the continuation and basic principles of the EU ETS post-2012 is quickly defined and incentives are in place for sectors to pursue this.

Keywords: Emissions trading; industrial competitiveness; spillovers; allowance allocation; perverse incentives. (search for similar items in EconPapers)
JEL-codes: F18 Q52 Q58 (search for similar items in EconPapers)
Pages: 29
Date: 2007-03
New Economics Papers: this item is included in nep-cse, nep-eec, nep-ene and nep-env
Note: Ec
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (21)

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Related works:
Working Paper: Differentiation and Dynamics of Competitiveness Impacts from the EU ETS (2007)
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