ERCST & IMPULS: Effectivity and risks of instruments implemented alongside the EU ETS
Author(s): Andrei Marcu, Alexandra Maratou, Nigel Caruana, Marino Varricchio, IMPULS-Stiftung
The EU Emissions Trading System (EU ETS) has so far not functioned on its own. Complementary measures, including subsidies, were put in place to deal with issues such as: the concurrent decarbonisation of all sectors, price of EUAs that for political and social reasons could not give the full signal for decarbonization.
Prepared for IMPULS-Stiftung, this report provides insights on examples of instruments that coexist alongside the EU ETS, to provide a better understanding of:
i) how they work, and the rationale behind their introduction;
ii) their effectiveness and efficiency;
iii) their interaction with and impacts on the EU ETS.
The following three instruments are considered by the study:
- Contracts for Difference (CfD) scheme for Renewable Energy (RE) in Spain;
- Carbon price floor (CPF) in the UK;
- Sustainable Aviation Fuel (SAF) blending quotas in Norway.
