[en] Tradeable emission permits are theoretically an attractive instrument for reducing CO₂ emissions. Such permits tie the emissions to a fixed ceiling, the costs of emission reduction being as low as possible (in other words, the instrument is both effective and efficient). But the theory has to be realisable in practice. Research into tradeable emission permits, on which the article is based, has shown that it is possible to design a system of tradeable CO₂ emission permits that can be implemented in practice. The instrument could also play a role in an international treaty for the reduction of CO₂ emissions, but in that case it must satisfy a number of preconditions. 1 photo

[en] Besides the standard, classical type of emission trading, in which emitters are allocated a fixed emission platform, a new variant has recently been discussed: emission trading with relative ceilings. The permitted emissions in this type of trading is determined by a performance standard defined in terms of quantity emitted per unit of product (or per unit of input) multiplied by that quantity produced. This article shows why this type of emission trading is popular with the business community and in government circles, but also why it is less efficient than the classical type of trading emissions with fixed ceilings

[en] Although one must be satisfied with the emission targets as agreed upon by the so-called Annex-I countries (mainly OECD and Middle- and East-Europe) during the conference on the Kyoto protocol in Japan, December 1997, there is still a lot to be desired. Some of the tools for the Annex-I countries to realize the targets are taking energy saving measures in the individual countries, tradeable emission rights, and joint implementation (also known as Clean Development Mechanism). 1 ill., 2 refs

[en] Tradable emission permits are one possible policy instrument for lessening the emission of greenhouse gases. The research project on 'Tradable CO₂ emission permits' is studying the design and the practical implementation of a system of tradable permits. A study is also being conducted of the bottlenecks that may occur if the theory is introduced in practice, and of the economic consequences of the introduction of tradable permits

[en] The feasibility of tradeable carbon permits as an instrument to implement climate change policy is discussed. The design of a scheme of tradeable carbon permits, that can be implemented either in a single European Union (EU) member state, or in the EU as a whole, is presented. Its feasibility is checked by comparing it with the recent sulphur allowance programme in the USA. The possibility and probability of failures in permit markets are discussed; in particular the conditions under which tradeable carbon permits might bar the entry of potential competitors. Next, it has been analysed how tradeable carbon permits can be combined with taxation of fossil fuels and what the consequences of such combinations are for the international coordination of climate change policy. 3 figs., 3 tabs., 48 refs

[en] A renewable obligation (RO) combined with tradable renewable energy certificates is a market-based instrument used to promote the production of electricity from renewable energy sources. A renewable obligation is an alternative for subsidies. A renewable obligation will only be an efficient instrument if certificate markets are efficient. This requires that there is no market power and no anti-competitive behaviour on the certificate market. If the current developments in Dutch renewable energy production continue, market power on a future renewable certificate market in the Netherlands will probably not be an issue, even if the RO should only rest on the retail market instead of on the whole electricity market. A renewable obligation will raise the retail price for consumers, thereby reducing consumer surplus. Simulations show that the retail electricity price increases with 30 euro per MWh to a level of 104 euro per MWh in case of a 30% renewable target. Consumer surplus is reduced with 19% compared to the baseline scenario. In contrast, a subsidy such as the Dutch SDE (Promoting Renewable Energy scheme or 'Stimulering Duurzame Energie') which is financed from the state budget has the effect to (slightly) lower the retail electricity price, thereby increasing consumer surplus. It should however be realised that the costs of the subsidy will indirectly affect electricity consumers through their tax payments.