IDEAS home Printed from https://ideas.repec.org/p/hal/wpaper/hal-00776451.html
   My bibliography  Save this paper

Carbon Leakage in the Primary Aluminium Sector

Author

Listed:
  • Oliver Sartor

    (CDC Climat Research - CDC Climat Research - Caisse des Depots)

Abstract

This paper provides an empirical analysis of the evidence of carbon leakage from the European primary aluminium industry during the first 6 ½ years of the European Union Emissions Trading Scheme (EU ETS). The findings suggest that while rising electricity prices in several major producer countries in the EU have played a critical role in the rise in net imports of EU primary aluminium into the EU in recent years, the role of CO2 costs in this equation has been more limited than was expected in the ex-ante literature. Other factors, including rising primary energy prices and difficulties for primary smelters in obtaining long-term electricity-supply contracts, appear to have been more economically important factors than the relatively low CO2 costs which have been witnessed so far.

Suggested Citation

  • Oliver Sartor, 2012. "Carbon Leakage in the Primary Aluminium Sector," Working Papers hal-00776451, HAL.
    • Handle: RePEc:hal:wpaper:hal-00776451
    Note: View the original document on HAL open archive server: https://hal.science/hal-00776451
    as

    Download full text from publisher

    File URL: https://hal.science/hal-00776451/document
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Pahle, Michael & Fan, Lin & Schill, Wolf-Peter, 2011. "How Emission Certificate Allocations Distort Fossil Investments: The German Example," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 39(4), pages 1975-1987.
    2. Jos Sijm & Karsten Neuhoff & Yihsu Chen, 2006. "CO 2 cost pass-through and windfall profits in the power sector," Climate Policy, Taylor & Francis Journals, vol. 6(1), pages 49-72, January.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Igor Shishlov & Romain Morel & Valentin Bellassen, 2016. "Compliance of the Parties to the Kyoto Protocol in the first commitment period," Climate Policy, Taylor & Francis Journals, vol. 16(6), pages 768-782, August.
    2. Eskander, Shaikh & Fankhauser, Samuel, 2021. "The impact of climate legislation on trade-related carbon emissions, 1997–2017," LSE Research Online Documents on Economics 111509, London School of Economics and Political Science, LSE Library.
    3. Antimiani, Alessandro & Costantini, Valeria & Kuik, Onno & Paglialunga, Elena, 2016. "Mitigation of adverse effects on competitiveness and leakage of unilateral EU climate policy: An assessment of policy instruments," Ecological Economics, Elsevier, vol. 128(C), pages 246-259.
    4. Mohamed Amine Boutabba & Sandrine Lardic, 2017. "EU Emissions Trading Scheme, competitiveness and carbon leakage: new evidence from cement and steel industries," Annals of Operations Research, Springer, vol. 255(1), pages 47-61, August.
    5. Marianne Fay & Stephane Hallegatte & Adrien Vogt-Schilb & Julie Rozenberg & Ulf Narloch & Tom Kerr, 2015. "Decarbonizing Development," World Bank Publications - Books, The World Bank Group, number 21842, December.
    6. Mohamed Amine Boutabba & Sandrine Lardic, 2017. "Does European primary aluminum sector is exposed to carbon leakage? New insights from rolling analysis," Economics Bulletin, AccessEcon, vol. 37(1), pages 614-618.
    7. Branger, Frédéric & Quirion, Philippe, 2014. "Would border carbon adjustments prevent carbon leakage and heavy industry competitiveness losses? Insights from a meta-analysis of recent economic studies," Ecological Economics, Elsevier, vol. 99(C), pages 29-39.
    8. Bosello, Francesco & Davide, Marinella & Alloisio, Isabella, 2016. "Economic Implications of EU Mitigation Policies: Domestic and International Effects," EIA: Climate Change: Economic Impacts and Adaptation 234938, Fondazione Eni Enrico Mattei (FEEM).
    9. Naegele, Helene & Zaklan, Aleksandar, 2019. "Does the EU ETS cause carbon leakage in European manufacturing?," Journal of Environmental Economics and Management, Elsevier, vol. 93(C), pages 125-147.
    10. Frédéric Branger, Philippe Quirion, Julien Chevallier, 2017. "Carbon Leakage and Competitiveness of Cement and Steel Industries Under the EU ETS: Much Ado About Nothing," The Energy Journal, International Association for Energy Economics, vol. 0(Number 3).
    11. Misato Sato & Karsten Neuhoff & Verena Graichen & Katja Schumacher & Felix Matthes, 2015. "Sectors Under Scrutiny: Evaluation of Indicators to Assess the Risk of Carbon Leakage in the UK and Germany," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 60(1), pages 99-124, January.
    12. Frédéric Branger & Oskar Lecuyer & Philippe Quirion, 2013. "The European Union Emissions Trading System : should we throw the flagship out with the bathwater ?," Working Papers hal-00866408, HAL.
    13. Dechezleprêtre, Antoine & Gennaioli, Caterina & Martin, Ralf & Muûls, Mirabelle & Stoerk, Thomas, 2022. "Searching for carbon leaks in multinational companies," Journal of Environmental Economics and Management, Elsevier, vol. 112(C).
    14. Stefano F. Verde & Christoph Graf & Thijs Jong and Claudio Marcantonini, 2016. "Installation entries and exits in the EU ETS industrial sector," RSCAS Working Papers 2016/19, European University Institute.
    15. Antoci, Angelo & Borghesi, Simone & Iannucci, Gianluca & Sodini, Mauro, 2021. "Should I stay or should I go? Carbon leakage and ETS in an evolutionary model," Energy Economics, Elsevier, vol. 103(C).
    16. Tan, Xiujie & Liu, Yu & Cui, Jingbo & Su, Bin, 2018. "Assessment of carbon leakage by channels: An approach combining CGE model and decomposition analysis," Energy Economics, Elsevier, vol. 74(C), pages 535-545.
    17. Frédéric Branger & Oskar Lecuyer & Philippe Quirion, 2015. "The European Union Emissions Trading Scheme: should we throw the flagship out with the bathwater?," Wiley Interdisciplinary Reviews: Climate Change, John Wiley & Sons, vol. 6(1), pages 9-16, January.
    18. Joltreau, Eugénie & Sommerfeld, Katrin, 2016. "Why does emissions trading under the EU ETS not affect firms' competitiveness? Empirical findings from the literature," ZEW Discussion Papers 16-062, ZEW - Leibniz Centre for European Economic Research.
    19. Svetlana V. Doroshenko & Anna D. Mingaleva, 2020. "Carbon Exchanges: European Experience in Developing the Mechanism of Emission Permit Trading," Finansovyj žhurnal — Financial Journal, Financial Research Institute, Moscow 125375, Russia, issue 4, pages 52-68, August.
    20. Sean Healy & Katja Schumacher & Wolfgang Eichhammer, 2018. "Analysis of Carbon Leakage under Phase III of the EU Emissions Trading System: Trading Patterns in the Cement and Aluminium Sectors," Energies, MDPI, vol. 11(5), pages 1-25, May.
    21. Sakai, Marco & Barrett, John, 2016. "Border carbon adjustments: Addressing emissions embodied in trade," Energy Policy, Elsevier, vol. 92(C), pages 102-110.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Germeshausen, Robert, 2018. "The European Union emissions trading scheme and fuel efficiency of fossil fuel power plants in Germany," ZEW Discussion Papers 18-007, ZEW - Leibniz Centre for European Economic Research.
    2. Xiong, Ling & Shen, Bo & Qi, Shaozhou & Price, Lynn & Ye, Bin, 2017. "The allowance mechanism of China’s carbon trading pilots: A comparative analysis with schemes in EU and California," Applied Energy, Elsevier, vol. 185(P2), pages 1849-1859.
    3. Veith, Stefan & Werner, Jörg R. & Zimmermann, Jochen, 2009. "Capital market response to emission rights returns: Evidence from the European power sector," Energy Economics, Elsevier, vol. 31(4), pages 605-613, July.
    4. David M. Newbery & David M. Reiner & Robert A. Ritz, 2018. "When is a carbon price floor desirable?," Working Papers EPRG 1816, Energy Policy Research Group, Cambridge Judge Business School, University of Cambridge.
    5. Sato, S. & Grubb, M. & Cust, J. & Chan, K. & Korppoo, A. & Ceppi, P., 2007. "Differentiation and dynamics of competitiveness impacts from the EU ETS," Cambridge Working Papers in Economics 0712, Faculty of Economics, University of Cambridge.
    6. Anke, Carl-Philipp & Hobbie, Hannes & Schreiber, Steffi & Möst, Dominik, 2020. "Coal phase-outs and carbon prices: Interactions between EU emission trading and national carbon mitigation policies," Energy Policy, Elsevier, vol. 144(C).
    7. Freebairn, John, 2012. "Tax mix change to reduce greenhouse gas emissions," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 56(1), pages 1-15, March.
    8. Marie Renner, 2014. "Carbon prices and CCS investment: comparative study between the European Union and China," Working Papers 1402, Chaire Economie du climat.
    9. Pezzey, John C.V. & Jotzo, Frank, 2010. "Tax-Versus-Trading and Free Emission Shares as Issues for Climate Policy Design," Research Reports 95049, Australian National University, Environmental Economics Research Hub.
    10. Karpf, Andreas & Mandel, Antoine & Battiston, Stefano, 2018. "Price and network dynamics in the European carbon market," Journal of Economic Behavior & Organization, Elsevier, vol. 153(C), pages 103-122.
    11. Li, Yan & Feng, Tian-tian & Liu, Li-li & Zhang, Meng-xi, 2023. "How do the electricity market and carbon market interact and achieve integrated development?--A bibliometric-based review," Energy, Elsevier, vol. 265(C).
    12. Wen, Xiaoqian & Bouri, Elie & Roubaud, David, 2017. "Can energy commodity futures add to the value of carbon assets?," Economic Modelling, Elsevier, vol. 62(C), pages 194-206.
    13. Tim Laing & Misato Sato & Michael Grubb & Claudia Comberti, 2013. "Assessing the effectiveness of the EU Emissions Trading System," GRI Working Papers 106, Grantham Research Institute on Climate Change and the Environment.
    14. Peiyao Shen & Regina Betz & Andreas Ortmann & Rukai Gong, 2020. "Improving Truthful Reporting of Polluting Firms by Rotating Inspectors: Experimental Evidence from a Bribery Game," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 76(2), pages 201-233, July.
    15. Frédéric Branger & Oskar Lecuyer & Philippe Quirion, 2015. "The European Union Emissions Trading Scheme: should we throw the flagship out with the bathwater?," Wiley Interdisciplinary Reviews: Climate Change, John Wiley & Sons, vol. 6(1), pages 9-16, January.
    16. Yihsu Chen & Jos Sijm & Benjamin Hobbs & Wietze Lise, 2008. "Implications of CO 2 emissions trading for short-run electricity market outcomes in northwest Europe," Journal of Regulatory Economics, Springer, vol. 34(3), pages 251-281, December.
    17. Gillenwater, Michael & Breidenich, Clare, 2009. "Internalizing carbon costs in electricity markets: Using certificates in a load-based emissions trading scheme," Energy Policy, Elsevier, vol. 37(1), pages 290-299, January.
    18. Angenendt, Nicole & Müller, Gernot & Stronzik, Marcus & Wissner, Matthias, 2007. "Stromerzeugung und Stromvertrieb – eine wettbewerbsökonomische Analyse," WIK Discussion Papers 297, WIK Wissenschaftliches Institut für Infrastruktur und Kommunikationsdienste GmbH.
    19. Schleich, Joachim & Betz, Regina & Rogge, Karoline S., 2007. "EU emission trading: better job second time around?," Working Papers "Sustainability and Innovation" S2/2007, Fraunhofer Institute for Systems and Innovation Research (ISI).
    20. Pape, Christian, 2018. "The impact of intraday markets on the market value of flexibility — Decomposing effects on profile and the imbalance costs," Energy Economics, Elsevier, vol. 76(C), pages 186-201.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:hal:wpaper:hal-00776451. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: CCSD (email available below). General contact details of provider: https://hal.archives-ouvertes.fr/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.