The Sustainability Impact of the EU Emissions Trading System on the European Industry

Raimund Bleischwitz, Katrin Fuhrmann and Elias Huchler
Additional contact information
Katrin Fuhrmann: Electrabel, Brussels
Elias Huchler: London Business School (LBS)

No 17, Bruges European Economic Policy Briefings from European Economic Studies Department, College of Europe

Abstract: This paper explains the mechanism of the EU Emissions Trading System (ETS) for the greenhouse gas carbon dioxide and explore into its likely sustainability impact on European industry. In doing so, it focuses on energy-intensive industries like cement, steel and aluminium production as well as on the emerging hydrogen economy. The paper concludes that at the moment it is still very inconsistently implemented and has a fairly narrow scope regarding greenhouse gases and involved sectors. It may also give an incentive to relocate for energy-intensive industries. In its current format, the EU ETS does not yet properly facilitate long term innovation dynamics such as the transition to a hydrogen economy. Nevertheless, the EU ETS is foremost a working system that – with some improvements – has the potential to become a pillar for effective and efficient climate change policy that also gives incentives for investment into climate friendly policies.

Keywords: emissions trading; climate policy; impact assessment. (search for similar items in EconPapers)
JEL-codes: K32 L Q48 Q58 (search for similar items in EconPapers)
Pages: 28 pages
Date: 2007-09
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Citations: View citations in EconPapers (5)

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Working Paper: The Sustainability Impact of the EU Emissions Trading System on the European Industry (2007)
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Persistent link: https://EconPapers.repec.org/RePEc:coe:wpbeep:17

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