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Pricing Carbon Emissions provides an economic critique on the utopian idea of a uniform carbon price for addressing rising carbon emissions, exposing the flaws in the economic propositions with a key focus on the EU's Emissions Trading System (ETS).After an Executive Summary of the contents, the chapters build up understanding of orthodox economics'role in protecting the neoliberal paradigm. A salient case, the ETS is successful in shielding the Business-as-Usual activities of the EU's industry, however this book argues that the system fails in creating innovation for decarbonizing production technologies. A subsequent political economy analysis by the author points to the discursive power of giant fossil fuel and electricity companies keeping up a façade of Cap-and-Trade utopia and hiding the reality of free permit donations and administrative price control, concealing financial bills mostly paid by household electricity customers. The twilights between reality and utopia in the EU's ETS are exposed, concluding an immediate end of the system is necessary for effective and just climate policy. The work argues that the proposition of shifting to a global uniform carbon tax is equally utopian. In practice, a uniform price applied on heterogeneous cases is not a source of benefits but one of ad-hoc adjustments, exceptions, and exemptions. Carbon pricing does not induce innovation, however assumed by the economic models used by IPCC for advising global climate policy. Thus, it is persuasively demonstrated by the author that these schemes are doomed to failure and room and resources need to be created for more effective and just climate politics. The book's conclusion is based on economic arguments, complementing the critique of political scientists.This book is written for a broad audience interested in climate policy eager to understand why decarbonizing progress is slow as it is. It marks a significant addition to the literature on climate politics, carbon pricing and the political economy of the environment more broadly.The Open Access version of this book, available at www.taylorfrancis.com, has been made available under a Creative Commons Attribution-Non Commercial-No Derivatives 4.0 license.

Mastering climate change has been recognised as a major challenge for the current decade. Besides the physical risks of climate change, the accompanying economic risks are substantial. Carbon Finance: A Risk Management View provides an in-depth analysis of how climate change will affect all aspects of financial markets and how mathematical and statistical methods can be used to analyse, model and manage the ensuing financial risks. There is a focus on the transition risk (termed carbon risk), but also a discussion of the impact of physical risks (as these risks are closely entangled) on the way to low carbon economies. This is a valuable overview for readers seeking an analysis of carbon risks from the perspective of financial risk management, utilising quantitative risk management tools.

In order to reach sustainable supply chains, the Ecologically Dominant Logic calls for improvement in measurements. With regard to climate change, this is the task of corporate carbon accounting and footprinting. This book contributes to these topics by proposing a double-entry based bookkeeping approach for carbon accounting, that enables continuous reporting along the supply chain, supports both product and corporate carbon footprinting and is compliant with the established carbon accounting standards. Furthermore, for estimating missing carbon footprints, a regression-based estimation approach is proposed and tested, which needs only publicly available data as input and facilitates the estimation at a decent level of quality without knowledge about the internal processes of a company.

The science is clear: climate change is a fact and the probability is extremely high that it has been caused by humans. At the same time, policy responses are hesitant, rather lukewarm and differ substantially between nation-states. The question is, what drives and what blocks radical action? This book makes the case that institutional settings, path dependence and emerging change coalitions are critical in explaining climate policies across the global political economy. Technological and social-political innovations are key drivers for dealing with climate change. This class of innovation is very much guided, or suppressed, by a national economy's established institutional settings. By anchoring national case studies in a version of the well established ‘varieties of capitalism'approach, the chapters of this book show why some economies are policy leaders and others become policy followers, or even policy interlockers. Moreover, the case studies demonstrate the extent to which external events and institutional constraints from the international polity influence national innovation strategies. Taking a unique analytical approach, which combines insights from innovation policies and a variety of capitalism literature, the authors provide genuine comprehension of the interplay between institutional settings, political actors and climate policies.National Pathways to Low Carbon Emission Economies offers a valuable examination of these issues on climate change that will be of interest to academics and postgraduates researching climate policy, economic policy and social movements. Furthermore, it is relevant for policy analysts and policy makers who are interested in learning from climate policies in the context of innovation strategies for a range of countries.

This book explores the microstructure of carbon markets and the pricing of carbon financial instruments generally. It provides a critical microstructure analysis of the EU Emissions Trading Scheme (EU-ETS), and also examines the theoretical and related market design issues affecting emissions trading schemes. Individual chapters analyse how intraday pricing evolves in carbon markets, the price impact of block trades in carbon financial instruments and their determinants, short and long-term liquidity effects in carbon markets, and the links between carbon market liquidity and efficiency. The aforementioned issues are explored using case studies of two major trading platforms operating within the EU-ETS. The book concludes by focusing on future policy and regulatory challenges in carbon markets, especially with respect to addressing pricing volatility challenges.

Analyse d'un nouvel univers financier : la Finance carbone.Un nouvel univers financier, celui de la Finance carbone, a été créé depuis 2005 qui a vu l'entrée en vigueur du Protocole de Kyoto et les débuts de l'ETS (Emission Trading System) en Europe. Dans cet univers, les pouvoirs publics jouent un rôle primordial puisqu'ils fixent les plafonds d'émission et sont donc maîtres de l'offre de quotas. L'avenir de la finance carbone après 2012 reste toutefois encore incertain ; en effet, aucun consensus sur la réalité même du changement climatique ne se dégage. La présentation du fonctionnement des marchés financiers du carbone, la description des instruments financiers, des plateformes d'échange, mais aussi les mécanismes des stratégies des différents acteur, ne peuvent qu'éclairer tous les professionnels et tous ceux qui entendent pénétrer les arcanes d'un monde beaucoup moins ésotérique qu'il peut parfois y paraître.Une présentation du fonctionnement des marchés financiers du carbonne et la description des outils qui régissent ce système économique par deux experts du domaine.EXTRAITLa finance carbone ne peut exister que s'il existe un cadre juridique bien établi car la valeur des actifs carbone ne dépend que de l'existence d'une réglementation. En effet, les entités achètent des quotas d'émissions pour remplir un objectif fixé par une autorité publique. Le cadre mondial qui fixe les objectifs d'émission est le Protocole de Kyoto. L'Union européenne a choisi de mettre en œuvre de manière ambitieuse le Protocole de Kyoto en fixant des objectifs directement aux entreprises européennes.Ainsi, les règles générales encadrant la finance carbone sont issues du Protocole de Kyoto. Cet accord international fixe notamment les engagements de réduction des émissions de GES pour les États industrialisés dits de l'annexe 1. De plus, le Protocole de Kyoto prévoit trois mécanismes de flexibilité qui font son originalité. Ceux-ci permettent une mutualisation de l'effort de réduction des émissions de GES au niveau mondial.D'abord, un des mécanismes de flexibilité permet l'échange de quotas d'émissions entre pays : ainsi, un pays plus efficace dans la limitation de ses émissions peut revendre ses permis d'émission excédentaires à un autre pays qui ne parvient pas à tenir ses objectifs.Ensuite, deux autres mécanismes de flexibilité permettent de disposer de crédits de carbone, équivalent à des quotas d'émission, quand sont réalisés des projets de réduction d'émissions de GES dans d'autres pays. En particulier, le mécanisme de développement propre (MDP) prévoit la possibilité d'investir dans des projets de réduction d'émissions de GES dans des pays en développement, impliquant ainsi les pays non industrialisés dans le processus de réduction d'émission mondiale.À PROPOS DE L'AUTEURLaurence Pico, co-auteur de La finance carbone, est Docteur en géographie de l'environnement global de l'Université Paris-Sorbonne (Paris IV) et diplômée de l'Ecole Nationale d'Assurances. Laurent Daniel, co-auteur de La finance carbone, est diplômé de l'Ecole Polytechnique et du MBA d'HEC, économiste au sein d'une grande institution publique et a travaillé en tant qu'économiste-stratégiste dans une banque d'investissement.

This book applies the multidisciplinary approaches of econometrics, statistics, finance and artificial intelligence for pricing and forecasting the carbon market in the context of managerial issues. It explores the related issues of pricing and forecasting the carbon market using theoretical models and empirical analyses, demonstrating how the carbon market, as a policy-based artificial market, is complex and influenced by both the market mechanisms and the external heterogeneous environments. By integrating the features of analytical systems, it offers insights to further our scientific understanding of the pricing mechanism and the variable laws governing the carbon market. Moreover, it lays a foundation for dealing with climate change in China and constructing a national carbon market there. Ultimately, it actively contributes to the energy saving and CO2 emission reduction promoted by the carbon market.The carbon market, represented by the European Union Emissions Trading System (EU ETS), is a cost-effective measure for tackling climate change. Furthermore, pricing and forecasting carbon market has been one of the research focuses in the fields of energy and climate change. As a policy tool of the trading mechanism, the carbon market offers a great institutional innovation for coping with climate change. Due to its multiple advantages including saving costs and environment protection, and political feasibility, more and more countries including China have applied the carbon market for carbon dioxide (CO2) emission reduction. Accurately understanding the pricing mechanism and mastering the fluctuating law of carbon market is essential to build a national carbon market for China.

Anthropogenic climate change poses a grave threat to societies around the world. The greenhouse gases that generate climate change are produced by virtually every sector of every economy. The predominant response of governments around the world is to mitigate climate change through the capping and trading of emissions. This book explores the establishment of emissions trading as a form of environmental, market-based governance in the United States, Europe, Australia, South Korea, Japan, and China. The book conceptualizes markets as institutions, and analyzes them as a system of climate governance. To this end, it argues that international efforts to promulgate markets run up against local cultures of markets that shape economic practices and knowledge to different degrees. While the global agenda under the United Nations Framework Convention on Climate Change has sought to develop similar systems to enable interconnected and synchronized emissions reductions, each of the cases analyzed here has produced different results. The markets and climate policies established reflect the syncretic impact of socio-political and cultural context on the institutional transfer of markets. Each country expresses a varying degree of ease or unease with the establishment of markets as systems of climate governance. Exploration of market adaptation adds new insights to theories of varieties of capitalism. The book also examines the material implications of emissions markets on the environment and climatic systems. In sum, the study finds that cultures of markets present a substantial challenge to a universalist prescription for resolving climate change and highlights issues at the interface of political and economic governance in different political economies. This includes issues of citizen, state, and industry participation, and the materiality of economic and financial productivity.

Too often amongst policy makers and thought leaders an assumption is made that we must make a choice between tackling climate change and having a strong economy; tackling climate change and allowing poorer nations to develop; tackling climate change and having a secure energy system. However, a decade of advanced modelling tested against historical data has provided wide evidence that well-chosen policies can be implemented that avoid these apparent either/or choices.This highly interdisciplinary book provides an overview of potential pathways for the decarbonisation of the global economy. By examining the entire global economy, we show policy-makers and thought-leaders that greatly reducing the risks of climate change can be consistent with energy security, economic development in poor nations, and vibrant economies in already developed nations. Advanced models of the relationships between the economy, energy and climate change pioneered at the Cambridge Centre for Climate Change Mitigation Research (4CMR) over the past decade provides a sound evidence base for decisions. This book examines not only the impacts of policies, but also the feasibility of bringing them forward and the ways in which energy, climate and economic policies can and must be joined up if climate, energy and economic goals are to be met globally.Economists, physicists, engineers, policy analysts, environmental scientists, climate scientists, political analysts, lawyers and computational scientists are brought together for the first time to produce analyses that make up a unique approach to a global problem that must be addressed sooner rather than later.

The VAT Carousel Fraud has seriously undermined the financial integrity of the European Union Emissions Trading Scheme (EU ETS). This timely book is the first to give an overview of fraud in the carbon market. Written by a former broker, it presents unique material on the carbon fraud mechanics and analyses the missing trader fraud (VAT fraud) on European carbon allowances markets with a focus on financial and organised crime issues.Fraud and Carbon Markets: The Carbon Connection assesses the weaknesses of the Kyoto Protocol and environmental markets, using statistics as a forensic tool on the capital markets. It describes specific cases, the court investigations and various mechanisms. It addresses issues of money laundering and international fraud on capital markets, such as stock manipulation, by exploring the financial mechanisms of the fraud, their impact on the market behaviour and the consequences on their econometric features.Researchers and students in climate change policy, environmental finance, financial law, organised crime, forensic statistics, financial regulation and risk management as well as financial regulators and policy makers will find this book of great interest.

Efficiency and Equity of Climate Change Policy is a comprehensive assessment of the economic effects of climate change policy, addressing the issues with a quantitative modelling approach. The book thus goes beyond the usual statements on the efficiency of economic instruments to identify the way gains and losses are distributed; who gains and who loses. Both the costs and benefits of climate change policies are analyzed. Most papers also provide useful information on the economic features of the Kyoto Protocol, its possible extensions, and the effect of different implementation strategies (such as the debate on emissions trading ceilings). Readership: Scientists and policy makers, students and specialists in climate related industries, members of NGOs, and policy advisors.

Holds critical information that is needed by anyone who wants to understand how to make money from'green'technology and how to avoid investments that will soon suffer from hidden carbon liabilities. Readers will learn to de-code a crucial component of this new economic driver - carbon credits, the world's first common currency.

Climate change is big business. Much of the money so-called green policies cost us goes straight into the pockets of a bewildering range of special interests. Around the world companies are making billions out of the schemes governments have put in place saying they will curb global warming and protect us from the threat of climate change. There is little evidence that those policies are an efficient way to cut emissions. They simply do not represent good value, and the public are right to be sceptical. In Let Them Eat Carbon Matthew Sinclair looks at the myths perpetuated by the burgeoning climate change industry, examines the individual policies and the potentially disastrous targets being put into place by ambitious politicians, and proposes a more realistic alternative.

Permit trading is an environmental policy instrument that has received increasing levels of attention over recent years. Coming from the field of air quality management, with the European CO2 emissions trading system being the most prominent example, it enters new fields of application, such as land use policy and biodiversity protection, water quality and water quantity trading. This book gives an overview of these recent developments and discusses the possibilities and limits of permit trading in environmental policies. The advantages of permit trading are not only seen with respect to economic efficiency, which leads to achieving the environmental target at minimum cost, but also with respect to the instrument's environmental effectiveness. By setting a cap for the overall emissions, a given environmental target can be met. This makes permit trading an interesting case for many environmental fields where safeguarding the environmental target plays a dominant role. Against this background, permit trading is discussed in environmental policy fields, where it has not been considered before, for example, land use management, biodiversity protection and water trading. Permit Trading in Different Applications analyses the properties of permit trading: its possibilities and limitations, its design options and its restrictions on a more general level. It demonstrates how lessons learnt in established policy fields like air quality management can be transferred to new and emerging fields of application. This collection will provide students and practitioners in environmental sciences and policy with valuable research into instrument choice and design with respect to permit trading.

An examination of how a transnational coalition of firms and NGOs influenced the emergence of emissions trading as a central component of global climate governance.Over the past decade, carbon trading has emerged as the industrialized world's primary policy response to global climate change despite considerable controversy. With carbon markets worth $144 billion in 2009, carbon trading represents the largest manifestation of the trend toward market-based environmental governance. In Carbon Coalitions, Jonas Meckling presents the first comprehensive study on the rise of carbon trading and the role business played in making this policy instrument a central pillar of global climate governance.Meckling explains how a transnational coalition of firms and a few market-oriented environmental groups actively promoted international emissions trading as a compromise policy solution in a situation of political stalemate. The coalition sidelined not only environmental groups that favored taxation and command-and-control regulation but also business interests that rejected any emissions controls. Considering the sources of business influence, Meckling emphasizes the importance of political opportunities (policy crises and norms), coalition resources (funding and legitimacy,) and political strategy (mobilizing state allies and multilevel advocacy).Meckling presents three case studies that represent milestones in the rise of carbon trading: the internationalization of emissions trading in the Kyoto Protocol (1989–2000); the creation of the EU Emissions Trading System (1998–2008); and the reemergence of emissions trading on the U.S. policy agenda (2001–2009). These cases and the theoretical framework that Meckling develops for understanding the influence of transnational business coalitions offer critical insights into the role of business in the emergence of market-based global environmental governance.

A PDF version of this book is available for free in open access via the OAPEN Library platform, www.oapen.org. This book examines the emergence of both financial markets and carbon markets, and provides an in-depth investigation on the fundamental determinants of financial development.

Emissions trading challenges the management of companies in an entirely new manner: Not only does it, like other market-based environmental policy instruments, allow for a bigger flexibility in management decisions concerning emission issues. More importantly, it shifts the mode of governance of environmental policy from hierarchy to market. But how is this change reflected in management processes, decisions and organizational structures? The contributions in this book discuss the theoretical implications of different institutional designs of emissions trading schemes, review schemes that have been implemented in the US and Europe, and evaluate the range of investment decisions and corporate strategies which have resulted from the new policy framework.

Climate change is one of the biggest challenges for mankind. Although there is increasing evidence that climate change is already occurring, there is neither sufficient knowledge as to what extent climate change poses risks to societies and companies, nor about adequate strategies to cope with these risks. Bringing together an international group of scholars from environmental economics, political science and business, this book describes, analyses and evaluates climate change risks and responses of societies and companies. The book contributes to the question of how climate change can be mitigated by discussing efficient and effective design of mitigation measures, in particular emissions trading and clean development mechanism (CDM). Placing special emphasis on the impact of climate change risks on business, the book investigates in which way selected sectors of the economy are affected and what measures they can undertake to adapt to climate change risks.

Seit Januar 2005 ist die RL 2003/87/EG in Kraft, welche ein Handelssystem mit Emissionszertifikaten für energieintensive Industrien auf europäischer Ebene implementiert. Katja Zwingmann unterzieht diese so genannte Emissionshandelsrichtlinie einer ökonomischen Analyse unter besonderer Berücksichtigung der Primärallokation von Zertifikaten. Die Ausgestaltung der Primärallokation wirft nicht nur verteilungspolitische, sondern auch Effizienzfragen auf, denn nur eine effiziente Primärallokation führt zu einem funktionierenden Handel. Die Autorin setzt sich mit verschiedenen Vergabeformen von Zertifikaten auseinander und untersucht, ob das europäische Allokationsverfahren bzw. die deutsche nationale Umsetzung ökonomisch effizient ist. Sie kommt zu dem Schluss, dass einzig eine Auktion der Zertifikate zum gewünschten Ergebnis führt, und empfiehlt bei der jetzigen Zusammensetzung der Teilnehmer ein holländisches Auktionsverfahren.

Over the last decade, market-based incentives have become the regulatory tool of choice when trying to solve difficult environmental problems. Evidence of their dominance can be seen in recent proposals for addressing global warming (through an emissions trading scheme in the Kyoto Protocol) and for amending the Clean Air Act (to add a new emissions trading systems for smog precursors and mercury--the Bush administration's'Clear Skies'program). They are widely viewed as more efficient than traditional command and control regulation. This collection of essays takes a critical look at this question, and evaluates whether the promises of market-based regulation have been fulfilled. Contributors put forth the ideas that few regulatory instruments are actually purely market-based, or purely prescriptive, and that both approaches can be systematically undermined by insufficiently careful design and by failures of monitoring and enforcement. All in all, the essays recommend future research that no longer pits one kind of approach against the other, but instead examines their interaction and compatibility. This book should appeal to academics in environmental economics and law, along with policymakers in government agencies and advocates in non-governmental organizations.

Containing rigorous hard evidence, this book is of immense practical use to postgraduates, researchers and business communities affected by or working in environmental regulation. The author, a leading name in the environmental economics community, examines the problem of urban smog in cityscapes and the difficulty of achieving cost-effective controls. Analyzing the key areas of urban smog, low-level ozone and volatile organic compound emissions and their impact on health and welfare of communities this text assesses and evaluates the performance of emissions trading systems and suggests alternative market designs for incentive control of pollution. Taking a well-reasoned approach to the contentious area of the use of market incentives to achieve environmental goals, it provides a study of the pioneering cap-and-trade market, particularly focusing on its poor performance in Chicago. A perfect supplementary text postgraduates and researchers, this is also an essential read for all those interested in environmental economics.

The 1997 Kyoto Conference introduced emissions trading as a policy instrument for climate protection. Bringing together scholars in the fields of economics, political science and law, this book, which was originally published in 2005, provides a description, analysis and evaluation of different aspects of emissions trading as an instrument to control greenhouse gases. The authors analyse theoretical aspects of regulatory instruments for climate policy, provide an overview of US experience with market-based instruments, draw lessons from trading schemes for the control of greenhouse gases, and discuss options for emissions trading in climate policy. They also highlight the background of climate policy and instrument choice in the US and Europe and the foundation of systems in Europe, particularly the EU's directive for a CO2 emissions trading system.

Markets are increasingly central to the resolution of environmental problems. They played a critical role in implementing the 1990 Clean Air Act of the United States, which has been instrumental in reducing acid rain in a cost-effective manner. They are also central to the global strategy adopted for limiting the emissions of greenhouse gases under the 1997 Kyoto Protocol and are being used for resolving conflicts over the use of other environmental resources, particularly water. Environmental Markets: Equity and Efficiency represents the first systematic and in-depth study of the economic issues raised by this growing use of environmental markets. Focusing on the relationship between equity and efficiency -- which is central to many of the debates between industrial and developing countries -- the book explores the underlying economics and the possibilities for win-win solutions that benefit all parties to the problems. Graciela Chichilnisky and Geoffrey Heal have been instrumental in developing the economic understanding required for the operation of environmental markets and for promoting their use among policy makers leading to the Kyoto Protocol. Contributors to this volume include established experts from international organizations, nongovernmental organizations, and academia, including RaUl Estrada-Oyuela, who chaired the negotiating committee of the Framework Convention on Climate Change and the 1997 Kyoto meetings.