Efficiency, Compensation, and Discrimination: What is at Stake When Implementing the EU Emissions Trading Scheme?
ZEW Discussion Paper No. 03-73 // 2003Abstract: In 2005, an EU-wide emissions trading scheme covering major CO2 producing sites shall comeinto power. The key objective of the trading scheme is to promote cost-efficiency of carbon reduction within the EU. We identify policy-relevant tradeoffs between overall efficiency, compensation and competitive neutrality which arise in the concrete implementation of the EU emissions trading scheme through National Allocation Plans.