The EU emissions trading scheme : The effects of industrial production and CO2 emissions on carbon prices
AbstractThis article critically examines the impact of industrial production for sectors covered by the EU Emissions Trading Scheme (EU ETS) on emissions allowance spot prices during Phase I (2005-2007). First, sector production indices are used as a proxy of economic activity in sectors covered by the EU ETS. Second, a ratio of allowance allocation relative to baseline CO2 emissions is used to measure the extent to which installations are constrained by the EU ETS. We show that carbon price changes react not only to energy prices forecast errors and extreme temperatures events, but also to industrial production in three sectors covered by the EU ETS : combustion, paper and iron.
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Bibliographic InfoPaper provided by Paris Dauphine University in its series Economics Papers from University Paris Dauphine with number 123456789/4223.
Date of creation: 2008
Date of revision:
Publication status: Published in Economie internationale, 2008, Vol. 4, no. 116. pp. 93-125.Length: 32 pages
EU ETS; Emissions Trading; Carbon Pricing; CO2 Emissions; Industrial Production;
Other versions of this item:
- Emilic Alberola & Julien Chevallier & Benoit Cheze, 2008. "The EU Emissions Trading Scheme: the Effects of Industrial Production and CO2 Emissions on Carbon Prices," Economie Internationale, CEPII research center, issue 116, pages 93-126.
- L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
- L16 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Industrial Organization and Macroeconomics; Macroeconomic Industrial Structure
- Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy
- Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters
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