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Transitional Free Allocation under EU ETS to Modernise Electricity Generation

Author

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  • Daniela Zănescu

    (The Bucharest University of Economic Studies)

Abstract

Investments in the modernisation of the electricity sector in certain lower income EU Member States are supported by the provisions of article 10c of the EU ETS Directive as derogation from the general rule of buying the necessary volume of EU allowances (EUA) thorough the auctioning method from the carbon market. Eight out of ten eligible Member States, including Romania make use of this derogation and allocate to the production of electricity a number of allowances for free if investments for modernization of the energy system are carried out. The objective of the paper is to analyze the benefits and costs when implementing the ETS derogation for the power sector, across EU and in Romania, according to the EU legislation and national procedure. The outcome of the paper is to set up a starting point for further debates and also the development of a point of view/analyse in the field.

Suggested Citation

  • Daniela Zănescu, 2019. "Transitional Free Allocation under EU ETS to Modernise Electricity Generation," Ovidius University Annals, Economic Sciences Series, Ovidius University of Constantza, Faculty of Economic Sciences, vol. 0(1), pages 339-346, August.
    • Handle: RePEc:ovi:oviste:v:xix:y:2019:i:1:p:339-346
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    More about this item

    Keywords

    climate change; EU emission trading scheme;

    JEL classification:

    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy

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