Can the EU ETS weather the impact of Covid-19?
The Covid-19 crisis has caused an economic downturn that may reverberate throughout the European carbon market. This makes a review of the EU ETS supply mechanisms imperative. In the previous economic crisis, the carbon price in the EU ETS dropped to very low levels as supply-demand imbalances increased. Today, the Market Stability Reserve (MSR) operates […]
The European Green Deal after Corona
Climate change policy cannot be the first priority of the EU for the immediate future. However, in spite of the corona-crisis the urgency of climate change mitigation has not disappeared. The post-corona recovery can both put the EU’s decarbonisation progress back on track – after low-carbon investments will inevitably take a hit – but the […]
An enabling framework for carbon capture and storage (CCS) in Europe
There are few credible scenarios for reaching the EU’s long-term climate policy objectives, such as net-zero by 2050, without the large-scale deployment of CCS technology. Carbon capture and storage technology is a pre-requisite for the decarbonisation of energy-intensive industries, which in the EU are responsible for about a fifth of all greenhouse gas emissions. At […]
Sinking to Zero
The updated EU long-term climate strategy with its net-zero emissions objective and the IPCC’s Special Report on the 1.5°C target prompt a renewed strategic look at negative emissions and carbon capture. Reaching net-zero greenhouse gas emissions requires more carbon sinks and other approaches to remove CO2 from the atmosphere. Furthermore, it will also require carbon […]
Composition and drivers of energy prices and costs in energy intensive industries
CEPS led a major study commissioned by the European Commission on the composition and drivers of energy prices and costs in energy intensive industries. Based on data collected from 189 plants over a 10-year period (2008-2017), the study shows energy prices and costs borne by EU producers operating in 11 energy intensive subsectors: bricks and roof […]
Five myths about an EU ETS carbon price floor
This policy insight outlines different perspectives on the past performance of the EU Emissions Trading System (ETS) in terms of its allowance price, analyses how the recent reform responded to related challenges , and considers the case for introducing a carbon price floor in the EU ETS. The main part of the paper identifies five […]
The European Battery Alliance
This contribution offers some insights into the strategy adopted by the European Battery Alliance, which was launched in 2017, and the challenges it faces before the review of the Clean Mobility Package is published. Author: Aurélie Faure-Schuyer On 11 October 2017, Vice President for Energy Union Maroš Šef?ovi? launched the European Battery Alliance (EBA), aiming to […]
Transforming Energy-Intensive Industries: Reflections on innovation, investment and finance challenges
The clean energy transition – necessitated by the Paris Agreement and implemented in the EU through the Energy Union strategy – is changing the industrial landscape in Europe. Viewed through the lens of competitiveness, this transition brings about threats as well as opportunities. This transition also leads to increased integration and linkages between climate and […]
A strong revision of the EU ETS, but the future may bring impetus for further reform
The ETS will be much stronger after the Phase 4 revision. But further adjustments may be inevitable in the future, given ongoing developments in the climate/energy world. In the wee hours of November 9th, agreement[1] was reached in a trilogue session between the European Parliament and the Council over the European Commission’s proposed revision of […]
The EU ETS price may continue to be low for the foreseeable future
Carbon prices in the EU ETS have been low for a number of years and might remain at relatively low levels for the foreseeable future. That does not mean that the EU ETS, or the price signal it produces, is meaningless. Incentives to abate greenhouse gas emissions exist at any price level (it is just […]
Impact of the EU ETS across Member States and Sectors
The most recent official data[1] on the EU’s Emissions Trading System (EU ETS) show that greenhouse gas emissions dropped by about 2.7% in 2016. This reduction would go somewhat beyond the proposed annual reduction of the cap of 2.2% in the fourth trading period (2021-30). The EU ETS covers many different sectors, however, including the […]
In the final stages of revising the EU ETS, the Parliament takes one step back
Following the European Parliament’s vote on February 15th, giving final shape to the EU Emissions Trading System for the coming period 2021-2030, Milan Elkerbout pronounces in this new CEPS Commentary that we now know that the chamber as a whole prefers a more moderate approach to the EU’s ‘flagship climate policy’ than had been advanced […]