Nentjes A ,
Boom JT ,
Dijkstra BT ,
Koster M ,
Woerdman E ,
Zhang ZX
400 p
in Dutch
2002
Toon Nederlands
English Abstract International emissions trading between private parties
established in Annex B countries requires international linkage of national
schemes of emissions trading. The report presents a design for national
emission trading schemes and rules for linking them to form an international
scheme. A national and international cap and trade scheme as well as a
credit trading scheme based on performance standards have been worked out.
Next to design issues the market performance and political acceptation of
types of national and international emission trading are discussed. A major
conclusion trading is that cap and trade is the most effective and efficient
national and international option, but credit trade is politically more
feasible. The conditions for adequate functioning of tradeable permit
schemes as well as potential market failures (high transaction cost, abuse
of market power and non cost minimizing behaviour) have been assessed. As a
potential type of international market failure the abuse of emission trading
schemes as instrument of trade policy has been identified. The question
whether differences in national permit schemes could distort international
competition on product markets is also discussed. Next to that the
arguments for and against and the restriction on flexibility proposed by the
EU until July 2001 are analysed and the impact of such a restriction on
market performance. Key words: emission trading, flexibility instruments
and climate change policy instruments.
