Emission Trading is seen as one of the most important instruments to reduce the emissions of greenhouse gases efficiently and to prevent dramatic climate changes.

In general it is expected that a higher degree of international integration of Emission Trading Schemes leads to an overall increase in efficiency. Previous research had shown that this is not necessarily true. Efficiency improvements through linking strongly depend on the concrete design of the linked domestic trading schemes. Therefore it is important to examine the advantages and risks that stem from a linking of the EU-ETS and an upcoming Australian Emission Trading Scheme.

The project “Linking of the European and Australian Emission Trading Schemes” analysed the requirements for a successful and efficient linking of both ETS and revealed potential pitfalls in the design of linked ETS.