Drawing on discussions within a CEPS Task Force on the revised EU emissions trading system, this report provides a comprehensive assessment of the pros and cons of the various measures put forward by different stakeholders to address the level and stability of the price of carbon in the EU. It argues that the European Commission, the member states, the European Parliament and other stakeholders need to give serious consideration to introducing some kind of ‘dynamic’ adjustment provision to address the relatively inelastic supply. The report also suggests that there is a need to improve communication of market-sensitive information, for example by leaving the management of the ETS to a specialised body.
Chaired by Henry Derwent, former President and CEO of the International Emissions Trading Association, the CEPS Task Force was composed of senior executives and other stakeholders from a broad range of businesses and industry, business associations, academic institutions and NGOs. Christian Egenhofer, Associate Senior Research Fellow, Andrei Marcu, Head of the CEPS Carbon Market Forum and Anton Georgiev, Associate Research Fellow, served as rapporteurs.