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The transformative potential of emissions trading

  • Limiting global warming to below 2 °C or even 1.5 °C requires a fundamental transformation of global socio-economic systems. This need for transformation has been taken up by international climate policy. This article synthesizes criteria of transformational change from transition research and climate finance agencies. On this basis, the article conducts a multi-criteria evaluation of the transformative potential of the European Union Emissions Trading Scheme (EU ETS), currently the world's largest market-based climate policy. From this case it can be inferred that emissions trading can "destabilize" incumbent high-emission practices, but its effectiveness in fostering innovation is limited. Furthermore, the analysis shows that details inLimiting global warming to below 2 °C or even 1.5 °C requires a fundamental transformation of global socio-economic systems. This need for transformation has been taken up by international climate policy. This article synthesizes criteria of transformational change from transition research and climate finance agencies. On this basis, the article conducts a multi-criteria evaluation of the transformative potential of the European Union Emissions Trading Scheme (EU ETS), currently the world's largest market-based climate policy. From this case it can be inferred that emissions trading can "destabilize" incumbent high-emission practices, but its effectiveness in fostering innovation is limited. Furthermore, the analysis shows that details in the arrangements of the scheme such as allocation rules can have a strong detrimental impact on its outcome. If a global carbon market with a uniform price were introduced, this could lead to developing countries "buying in" with large amounts of freely allocated allowances. This, however, has been shown to thwart transformational effects and instead contribute to further carbon lock-in.show moreshow less

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Metadaten
Document Type:Peer-Reviewed Article
Author:Lukas HermwilleORCiDGND, Wolfgang Obergassel, Christof Arens
URN (citable link):https://nbn-resolving.org/urn:nbn:de:bsz:wup4-opus-62972
Year of Publication:2015
Language:English
Source Title (English):Carbon management
DOI:https://doi.org/10.1080/17583004.2016.1151552
Volume:6
Issue:5-6
First Page:261
Last Page:272
Release Date:2016/04/22
Division:Energie-, Verkehrs- und Klimapolitik
Dewey Decimal Classification:320 Politik
OpenAIRE:OpenAIRE
Licence:License LogoIn Copyright - Urheberrechtlich geschützt