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The CO2 Trading Market in Europe: A Financial Perspective

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Original languageEnglish
Title of host publicationFinancial Aspects in Energy
Subtitle of host publicationA European Perspective
EditorsAndre Dorsman, Wim Westerman, Mehmet Baha Karan, Ozgur Arslan
Place of PublicationBerlin Heidelberg
PublisherSpringer-Verlag GmbH
Pages51-67
Number of pages18
Edition1
ISBN (Electronic)978-3-642-19709-3
ISBN (Print)9783642197086, 978-3-642-44619-1
DOIs
Publication statusPublished - 2011

Abstract

The trading of carbon dioxide (CO 2 ) emission allowances, or permits, has been established in recent years as one of the primary mechanisms for tackling global warming and climate change. The European Union (EU) has taken an important initiative in this direction by establishing in 2003 the first ever mandatory cap-and-trade system for CO 2 permits: the EU Emissions Trading Scheme (EU ETS). The purpose of this paper is to initially provide a brief introduction to the EU ETS and subsequently assess its operation during the years 2005-2010 from a financial market perspective. Th e insights gained through this analysis are particularly important not only for policy makers and market stakeholders but also for the growing community of the so-called ‘carbon’ investors.

    Research areas

  • emission allowances, emissions trading, EU ETS, carbon finance

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