Tradable Performance Standards for a Greener Automobile Sector: An Economists’ Appraisal of the German Greenhouse Gas Mitigation Quota

Constanze Liepold (), Paul Fabianek () and Reinhard Madlener
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Constanze Liepold: E.ON Energy Research Center, Future Energy Consumer Needs and Behavior (FCN)
Paul Fabianek: E.ON Energy Research Center, Future Energy Consumer Needs and Behavior (FCN)

No 9/2023, FCN Working Papers from E.ON Energy Research Center, Future Energy Consumer Needs and Behavior (FCN)

Abstract: The Greenhouse Gas (GHG) Mitigation Quota is a unique instrument in Europe that redistributes money from high emission to low emission fuel markets, while forcing fuel distributors to reduce the average emissions of their fuels. This paper presents the design of the German 2022 GHG Quota, places it in the context of environmental policy instruments, and examines its impact on the affected fuel markets in relation to other environmental policy instruments. We aim to identify the strengths and weaknesses of the GHG Quota Trading as an alternative to allowance trading and carbon taxes, deliver results that can be applied in industry and policy making, and provide a basis for further research. Field research was conducted in the form of expert interviews. Furthermore, intermediaries and brokers were contacted via email and asked for transaction data. In addition, a qualitative literature review was conducted and publications of responsible authorities as well as relevant legal texts, were used to gather information. We find that the GHG Quota Trading overlaps with the instruments emission standards and emission trading scheme and therefore falls under the category of tradable performance standards. However, it also contains aspects of a subsidy and interacts directly or indirectly with several different markets

Keywords: GHG Quota; environmental policy instrument; poolers (search for similar items in EconPapers)
JEL-codes: A11 B55 (search for similar items in EconPapers)
Pages: 31 pages
Date: 2023-08-01
New Economics Papers: this item is included in nep-ene, nep-env and nep-tre
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:ris:fcnwpa:2023_009

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