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Carbon Prices are Redundant in the 2030 EU Climate and Energy Policy Package

Finn Roar Aune and Rolf Golombek

No 7364, CESifo Working Paper Series from CESifo Group Munich

Abstract: In June 2018, an agreement between key EU institutions – the Commission, the European Parliament, and the European Council – was reached after a long-lasting discourse over the 2030 EU climate and energy policy package. This paper offers a comprehensive assessment of the EU package, with its three main targets: lower greenhouse gas emissions, higher renewable share in final energy consumption, and improved energy efficiency. We find that the renewable and energy-efficiency targets have been set so high that the derived emissions reduction exceeds the EU climate target. Hence, carbon prices are redundant in reaching the EU climate goal. This policy, however, is not cost efficient.

Keywords: climate policy; renewables; energy efficiency; nuclear phase out; energy modeling (search for similar items in EconPapers)
JEL-codes: Q28 Q41 Q48 Q54 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-ene, nep-env and nep-reg
Date: 2018
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