Publications

Summary of stakeholder responses to the public consultation for a border carbon adjustment in the EU

25/11/2020

The European Commission published a questionnaire on a Carbon Border Adjustment Mechanism (CBAM) for the public consultation that took place between July 22 and October 28 2020.

The objective of this paper is to highlight and summarize key points raised in the submissions responding to the latest public consultation, capturing the differences, commonalities and general trends, in order to provide the reader with a concise overview of stakeholders’ positions on CBAM for the EU. This paper is limited to the over 20 submissions that were made available to ERCST by some of the stakeholders that made submissions. An overview of the submissions covered, highlighting the key points made, is presented in alphabetical order in a summary table.

Given the limited number of submissions considered for this paper, the official summary by the European Commission may be different.

Author(s): Andrei Marcu, Dariusz Dybka and Alexandra Maratou

ERCST-CEEP paper, the role of the EU ETS funding mechanisms in financing the European Green Deal

16/11/2020

Following up to the event organised at the end of October, this paper, written by ERCST in cooperation with CEEP, seeks to provide an overview of developments and regulatory decisions made in 2020 for the four EU ETS funding mechanisms, i.e. the Solidarity Provision, Article 10c Derogation, the Modernisation Fund, and the Innovation Fund.

In addition, this paper assesses how the size of the EU ETS funding mechanisms will be impacted under different scenarios. It shows how developments like a recalculation of the cap following Brexit, or an increase in the 2030 target, would affect the amount of allowances available under the EU ETS in phase 4, and under the individual funding mechanisms in each Member State.

Author(s): Andrei Marcu, Mariusz Kawnik, Domien Vangenechten and Angelina Bartosik

Position paper - ERCST's rationale for the submission to the Public Consultation for the Border Carbon Adjustment Mechanism under the European Green Deal

28/10/2020

This position paper accompanied ERCST's response to the European Commission's public consultation for the Border Carbon Adjustment Mechanism under the European Green Deal. This paper presents the rationale behind ERCST’s submission.

ERCST’s response to the Public Consultation builds on the work that it has carried out previously on the topic of Border Carbon Adjustments, and a long- term interest and examination of issues related to addressing carbon leakage and competitiveness.

Author(s): Andrei Marcu, Dariusz Dybka and Alexandra Maratou

Position paper - ERCST's rationale for the submission to the Public Consultation for the Revision of the Energy Taxation Directive

14/10/2020

This position paper accompanied ERCST's response to the Commission's public consultation for the revision of the Energy Taxation Directive (2003/96/EC). This paper presents the rationale behind ERCST’s submission.

From discussion with stakeholders, we consider two main priorities for the revision of the ETD:

  1. Avoiding double taxation between the EU ETS, which is seen as the main carbon pricing instrument at the European level, and the ETD, if this will be revised to tax fuels based on their carbon content.
  2. Eliminating “fossil fuel subsidies”, also deriving from the current revision’s mandatory exemption for aviation and maritime fuels. For the aviation sector, the carbon component is covered by the EU ETS. Therefore, to avoid double taxation, the ETD should exempt aviation fuel at least for its carbon content, if the ETD will be revised to include a CO2 component.

Author(s): Andrei Marcu and Dana Agrotti

Border Carbon Adjustments in the EU: Issues and Options

30/09/2020

This report brings together the main takeaways from the project ‘Border Carbon Adjustments (BCAs) in the EU: Issues and Options’ launched in November 2019 to provide analytical input and foster an informed debate with domestic and international stakeholders as the CBAM file progresses through the early stages of the legislative process.

Drawing on extensive feedback obtained in a series of stakeholder consultations, the report offers a detailed analysis of the building blocks of BCAs as a policy option in the European context, discusses alternative policy options, and considers different combinations of policy instruments to achieve the desired outcomes.

The report applies a heuristic multi-criterion analysis to BCAs and breaks this policy instrument down into eight design elements, each with several implementation options. 

Author(s): Andrei Marcu, Michael Mehling and Aaron Cosbey

Reflections on ERCST's "creating markets for low-carbon products in the EU" work stream

08/07/2020

This paper represents some take-aways and general reflections from the ERCST discussions on creating markets for low-carbon products in the EU.

After outlining the existing regulatory framework and highlighting the challenges on the supply side and demand side, this paper discusses a set of policy solutions that could help address the following questions:

  1. How to incentivise companies to invest in low-carbon production technologies?
  2. How to incentivise consumers to buy low-carbon products?
  3. How to create a level playing field for low-carbon products?
  4. Who pays the bill? The polluter, the government, the society?

Author(s): Andrei Marcu and Matteo Caspani

Position Paper- Comments to the Public Consultation for the 2030 Climate Target Plan

23/06/2020

This position paper accompanied ERCST's response to the Commission's public consultation for the EU Climate ambition for 2030 and for the design of certain climate and energy policies of the European Green Deal. 

Author(s): Andrei Marcu, Dariusz Dybka and Domien Vangenechten

Background Paper - The EU ETS Market Stability Reserve: Coping with Covid-19 and Preparing for the review

16/06/2020

This background note, the authors reflect on some of the recent developments and raise five issues for discussion with regard to the upcoming review of the Market Stability Reserve, and its role in the EU ETS.

These issues should not be seen as ‘truths’ in any way, but simply served as ‘food for thought’ for the June 16 meeting organised by ERCST.

Author(s): Andrei Marcu, Jean-Yves Caneill and Domien Vangenechten

Feedback paper - European Commission's proposal for a European Climate Law

30/04/2020

This position paper accompanied ERCST's response to the feedback opportunity regarding the Commission’s proposal for the European Climate Law.

Author(s): Andrei Marcu and Domien Vangenechten

2020 State of the EU ETS Report

28/04/2020

The yearly State of the EU ETS Report aims to be an independent contribution to the policy debate, which is needed to ensure that the EU ETS is “fit for purpose.”

It is intended as a “snapshot”, providing policymakers and stakeholders with an overview of how the EU ETS is doing by April of each year, based on previous year data.

This year, the report focuses on 6 key areas:

  • Implications of COVID-19
  • Recent policy developments
  • Environmental delivery
  • Economic delivery
  • Market functioning
  • The EU ETS in the European Green Deal

This report is jointly produced by ERCST, BloombergNEF, the Wegener Center and Ecoact 

Author(s): Andrei Marcu, Domien Vangenechten, Emilie Alberola, Jahn Olsen, Jean-Yevs Caneill, Stefan P. Schleicher and Roman de Rafael

The Paris Agreement's Article 6 and the WTO: Points of Convergence

27/04/2020

Climate change is one of the defining challenges of our time. That is, it is becoming ever clearer that relative global success or failure in addressing this challenge will fundamentally dictate the nature of humanity’s future. As such, it behooves us to think of the ways in which all areas of policy might contribute to efforts to address climate change. In the area of trade law and policy, this boils down to two types of actions: amending trade law or policy that unduly impedes climate action, and formulating new trade laws or policies that proactively support climate change objectives such as mitigation or adaptation. This essay will explore the first type of option: the links between World Trade Organization (WTO) law and article 6 of the Paris Agreement.

Copyright © 2020 by the Centre for International Governance Innovation. The opinions expressed in this publication are those of the authors and do not necessarily reflect the views of the Centre for International Governance Innovation or its Board of Directors. This work is licensed under a Creative Commons Attribution – Non-commercial – No Derivatives License. To view this license, click hereFor re-use or distribution, please include this copyright notice.

Author(s): Andrei Marcu and Aaron Cosbey

Feedback paper - Inception Impact Assessment on the 2030 Climate Target Plan

14/04/2020

This position paper accompanied ERCST's response to the feedback opportunity regarding the Commission’s Inception Impact Assessment on 2030 Climate Target Plan .

Author(s): Andrei Marcu and Dariusz Dybka 

Feedback paper - Inception Impact Assessment on the Energy Taxation Directive Review

31/03/2020

This position paper accompanied ERCST's response to the feedback opportunity regarding the Commission’s Inception Impact Assessment on the review of the Energy Taxation Directive .

Author(s): Andrei Marcu, Dana Agrotti and Dariusz Dybka 

Feedback paper - Inception Impact Assessment on the Carbon Border Adjustment Mechanism

27/03/2020

This position paper accompanied ERCST's response to the feedback opportunity regarding the Commission’s Inception Impact Assessment on the Carbon Border Adjustment Mechanism .

Author(s): Andrei Marcu, Dariusz Dybka and Eric Wilczynski 

Beyond the EU NDC - Assessing efforts to be Europe's climate leaders

20/03/2020

In the context of the Paris Agreement, the European Union is increasing its efforts towards decarbonisation. Currently, the EU climate strategy is centred around three emissions reduction targets compared to 1990 levels: a cut of 20% of GHG emissions by 2020, at least 40% by 2030; and an implicit reduction of 80-95% by 2050. These targets have increasingly been put into question, as many stakeholders are pushing the EU to speed up its decarbonisation efforts and embrace the goal of climate neutrality by 2050.

The ‘Beyond the EU NDC’ report proposes a methodology which can be used to assess whether Member States and other stakeholders are undertaking efforts to go ‘beyond’ their respective 2030 targets, and what is their perspective on the 2050 strategy and the target of carbon neutrality.

Author(s): Wijnand Stoefs, Andrei Marcu, Eric Wilczynski

Feedback paper - draft implementing regulation on the EU ETS Modernisation Fund

16/03/2020

This position paper accompanied ERCST's response to the feedback opportunity regarding the Commission’s draft implementing regulation laying down detailed rules for the operation of the Modernisation Fund. 

Author(s): Domien Vangenechten

Feedback paper - proposal for a regulation establishing the Just Transition Fund

12/03/2020

This position paper accompanied ERCST's response to the feedback opportunity regarding the Commission’s proposal for a regulation establishing the Just Transition Fund.

Author(s): Andrei Marcu & Dariusz Dybka

Public consultation response - draft ETS state aid guidelines for indirect costs compensation

8/03/2020

This position paper accompanied ERCST's response to the public consultation regarding the Commission’s ‘draft guidelines on certain State Aid measures in the context of the system of greenhouse gas emissions trading post- 2021'.

Author(s): Domien Vangenechten

Reporting on the Impacts of Response Measures

02/12/2019

Climate change mitigation policies (also known under the UNFCCC as ‘Response measures’) will need to be put in place and/or strengthened around the world to enable the transition of economies and societies away from fossil fuels and towards a low-carbon future. Response measures will have impacts, both in the countries implementing them and across borders.

ERCST not only organizes the 'Informal dialogue on Response measures’ project, but has been working intensely on developing a methodology that countries can use to report to the UNFCCC (under Biennial Update Reports and, starting in 2024, Biennial Transparency Reports) on the impacts of response measures and the tools and support necessary to address and manage those impacts.

Two reports were produced in light of this effort:

  1. The methodology describing in detail how a country could assess and report on the impacts of response measures
  2. The Chile country case study, which ERCST developed to test the practical implementation of the methodology.

Author(s): Maria Antonia Reis Teixeira da CostaWijnand StoefsAndrei Marcu and Aaron Cosbey

Unlocking Article 6 of the Paris Agreement

20/11/2019

Looking ahead to COP 25 in Madrid, this paper puts forward three key issues that are blocking a successful outcome on the Article 6 rulebook.

While there are many operational issues which are contentious, the issues that are truly blocking a positive outcome are" issues of principle" or "political issues” that will need to be addressed at the political or Head of Delegation level.

After these issues are addressed, addressing operational matters will become possible. The first condition to solve problems is to recognise them and take steps to address them in a negotiating, dispassionate spirit.

 

Author(s): Andrei Marcu

Preparing the review of the EU ETS Market Stability Reserve

18/11/2019

The MSR became operational in 2019, and its first review is scheduled in 2021. This review should include two elements: i) the track-record of the MSR; ii) the future impacts of the Reserve. The decision whether to change the MSR parameters or not, and if so, how, will need to be based on this analysis, as well as a discussion on what the MSR ought to achieve.

This report aims to promote a debate on:

  • The components of the MSR review,
  • The structure of the review,
  • The parameters and data that should be monitored, leading to the 2021 scheduled review.

Implementation of the funding mechanisms in the fourth phase of the EU ETS: state of play

18/10/2019

The revision for the fourth phase of the EU Emission Trading System (ETS), covering the period 2021 - 2030, introduced a number of changes concerning the funding mechanisms for climate and transition purposes in the system. Last year, ERCST and CEEP produced a paper on these funding mechanisms, which discussed their respective functioning, eligibility, size, explained how they are related to each other, and highlighted a number of issues and questions that should be addressed during the implementation phase. Since then, a number of new developments have taken place that are worth discussing.This paper:

  • provides an update on the state of play of the implementation process of the four funding mechanisms;
  • highlights some of the main takeaways from the stakeholder sentiment analysis; and
  • sheds light on the decisions made by eligible Member States regarding the use of Article 10c Derogation and the flexibility mechanism.

Author(s): Andrei Marcu, Maciej Jakubik, Domien Vangenechten and Michal Dlugosz

Reflection note on "Strategic challenges to the EU ETs in the long-term" brainstorm session

16/10/2019

This reflection note should be read as general reflections from ERCST to the brainstorm session organised on September 27, which was intended to discuss, and discover key issues which need to be explored, as well as possibly identify work that may need to be done in the mid to long-term to help the EU ETS to remain resilient, relevant and acceptable.

Author(s): Andrei Marcu, Jean-Yves Caneill, Domien Vangenechten

Summary note on "incentivising carbon dioxide removal technologies" brainstorm session

2/10/2019

There is a current lack of incentives for Carbon Dioxide Removal Technologies (CDRTs), with clear financial and/or regulatory frameworks missing in some cases. This is despite the vital need for developing these nascent CDRTs in order to remain within the 1.5-degree goal, as highlighted by multiple scenarios from the IPCC, European Commission and other key actors. This summary note, following the brainstorm session organised on September 24 focuses on the questions and issues surrounding the enabling regulatory and financial framework necessary for deploying these technologies at scale.

Author(s): Andrei Marcu, Federico Cecchetti and Maria Antonia Reis Teixeira da Costa 

Linkages between Cooperative Approaches, Transparency and Compliance (Articles 6, 13 and 15 of the Paris Agreement)

19/08/2019

This Policy Brief identifies linkages between cooperative approaches provided for in Article 6 (in particular guidance for Article 6, paragraph 2, and the rules, modalities and procedures for Article 6, paragraph 4), the modalities, procedures and guidelines for the Transparency Framework, and the Modalities and Procedures for the committee established by Art. 15.

Author(s): Christina Voigt

Appeal Procedure for the Mechanism Established by Art. 6.4 of the Paris Agreement

19/08/2019

This Policy Brief gives a brief overview for the reasons advocating for an appeal procedure to be included in the governance structure for the mechanism established in Article 6.4 of the Paris Agreement, including lessons learned from the Clean Development mechanism (CDM). It will then assess different possible options for such an appeal procedure.

Author(s): Christina Voigt

Feedback on the draft implementing regulation laying down arrangements for the adjustments to free allocation of emission allowances due to activity level changes

04/07/2019

This paper represents ERCST's feedback to the European Commission's draft implementing regulation regarding free allocation adjustments due to activity level changes. 

Author(s): Domien Vangenechten

Flow of tracking ITMOs & performing, reporting, recording and review of corresponding adjustments

08/05/2019

This reflection paper aims to explore these differences in understanding and interpretation of the flow of tracking of ITMOs and performing, reporting, recording, and review of corresponding adjustments, and tries to capture what they imply by these different views, when looking from the perspective of practical implications. The paper is not intended to advocate any particular position.

Author(s): Andrei Marcu & Supanut Chotevitayatarakorn, TGO

2019 State of the EU ETS Report

07/05/2019

The yearly State of the EU ETS Report aims to be an independent contribution to the policy debate, which is needed to ensure that the EU ETS is “fit for purpose.” This report discusses the current state of play in the EU ETS while abstaining, to the extent possible, from providing solutions. 

This report is undertaken by ERCST, ICIS, I4CE, EcoAct and the Wegener Center

Author(s): Andrei Marcu, Emilie Alberola, Jean-Yevs Caneill, Matteo Mazzoni, Stefan P. Schleicher, Wijnand Stoefs, Charlotte Vailles, Domien Vangenechten and Federico Cecchetti

The 'Article 15 Committee' to Facilitate Implementation and Promote Compliance

15/04/2019

This policy brief outlines the modalities and procedures for the operation of the 'Article 15 committee', as set up by Article 15 of the Paris Agreement, looking at the nature, composition, competences and decision-making of the Committee. It gives an overview of the ways in which issues will be brought before the Committee, how the Committee could respond and possible further steps in its development.

Author(s): Christina Voigt

Corresponding Adjustments: Interpretation of the “Buffer Account"

15/04/2019

This paper aims to address a reoccurring issue in the Article 6 "corresponding adjustments" negotiations for further elaboration: namely, what is to be adjusted under the "buffer account approach". It provides a brief overview of this approach, providing an example formula and an illustrative example, in order to help clarify any remaining confusion.

Author(s): Andrei Marcu

Possible Interpretation of Discussions on Article 6.4 and Corresponding Adjustments

20/03/2019

This paper offers our interpretation and understanding of the discussion surrounding these issues. It gives a brief overview of the following topics and issues: First Transfer for Article 6.4 units; Corresponding adjustments; What is meant by beyond NDC; and NDC Accounting vs. Inventory Accounting.

Author(s): Andrei Marcu & Chandra Sinha 

Reflections Post-Katowice

18/03/2019

This paper offers key insight into some of the pivotal issues and reflections surrounding the  negotiations and outcomes of Article 6 of the Paris Agreement from the COP 24 in Katowice.

Author(s): Andrei Marcu

Rulebook for Article 6 of the Paris Agreement - Takeaway from the COP 24 outcome

25/02/2019

In order to better understand the Article 6 outcomes from COP 24 in Katowice, this paper examines and compares the different versions of text that emerged at key moments in the two weeks of negotiations, and tries to identify evolution and changes in key issues in the text, and discuss and analyse these changes.

Author(s): Andrei Marcu and Mandy Rambharos

Position Paper - Free allcoation adjustments due to activity level changes in Phase 4 of the EU ETS

22/02/2019

This position paper accompanied ERCST's response to the European Commission's public consultation regarding the implementing act on free allocation adjustments due to activity level changes. 

Author(s): Andrei Marcu, Wijnand Stoefs and Domien Vangenechten

The EU's NDC after the Talanoa Dialogue - Options paper

21/01/2019

This paper explores a number of major options that the EU could consider if the decision is made to enhance the EU NDC. It shows that the options are varied, with significant differences in terms of additional mitigation effort, political will and environmental impacts.

Author(s): Andrei Marcu, Simone Borghesi, Wijnand Stoefs, Isabella Alloisio, Francesco Nicolli, Domien Vangenechten

The EU's NDC after the Talanoa Dialogue - Policy paper

26/11/2018

This paper accompanies the 'Options paper' on ways to enhance the EU's NDC after the Talanoa Dialogue. It was released right before COP 24 in Katowice. It draws a number of overall conclusions based on discussions held with stakeholders, both through a survey as well as through workshops organised in Bratislava, Brussels, Bucharest, Florence, Prague and Warsaw.

Author(s): Andrei Marcu and Simone Borghesi

Funding Mechanisms in the fourth phase of the EU ETS: Exploring what is known and identifying issues for clarification and discussion

19/09/18

This paper has two objectives: Firstly, it aims to lay out the components and provide an understanding of the functioning of these different funding mechanisms embedded within the EU ETS, and explore how they are articulated to one another. Secondly, it tries to identify issues that need to be further understood and clarified in terms of the operationalisation of the four funding mechanisms.

Author(s): Andrei Marcu, Jean-Yves Caneill, Wijnand Stoefs,  Domien Vangenechten

Article 6.2 Advanced Options Paper

15/08/18

This advanced options paper on article 6, paragraph 2 of the Paris Agreement is an update of the option paper (Straw Man) jointly produced by Reed Smith and ICTSD in February 2018.

Author(s): Andrei Marcu, Peter Zaman

Feedback paper - draft implementing regulation on the EU ETS Modernisation Fund

16/03/2020

This position paper accompanied ERCST's response to the feedback opportunity regarding the Commission’s draft implementing regulation laying down detailed rules for the operation of the Modernisation Fund

Author(s): Domien Vangenechten

Feedback paper - proposal for a regulation establishing the Just Transition Fund

12/03/2020

This position paper accompanied ERCST's response to the feedback opportunity regarding the Commission’s proposal for a regulation establishing the Just Transition Fund.

Author(s): Andrei Marcu & Dariusz Dybka

Northeast Asia Carbon Market and Trade Connections

03/07/18

This Asia Society Policy Institute (ASPI) and ICTSD report focuses on carbon pricing and the linking of carbon pricing systems as a potential catalyst for increased trade relationships.

Author(s): Andrei Marcu, ASPI

Decoding Article 6 of the Paris Agreement

30/04/18

This publication examines the options for establishing guidance, rules, and modalities for the key elements of Article 6, decoding main issues.

Author(s): Andrei Marcu

What is standing in the way of a happy ending? Reflections on Art 6 before SBSTA 48

26/04/2018

This paper is intended as a reflection on some of the issues that need to be recognised, and may need attention, if we are to deliver at the COP in Katowice.

Author(s): Andrei Marcu

Glossary of Terms for Article 6.2

26/04/2018

This Glossary of Terms is meant as a starting point for discussion and will be improved as we get comments and as negotiations progress.

Author(s): Andrei Marcu

Developing the EU Long-Term Strategy. Technical paper

18/04/18

This technical paper is the outcome of a year-long effort, which included a series of stakeholder engagements in five EU capitals at the beginning of 2018.

Author(s): Andrei Marcu, Georg Zachmann, Samuel Gonzalez Holguera, Wijnand Stoefs

Developing the EU Long-Term Strategy. Policy paper

18/04/18

This policy paper seeks to develop a series of consistent choices upon which the new European Long-Term Climate Strategy can be built. It is produced under the project “Developing the EU Long-Term Climate Strategy". 

Author(s): Andrei Marcu, Georg Zachmann

2018 State of the EU ETS Report

17/04/18

The EU Emissions Trading System (EU ETS) is important through its role as the “cornerstone” of EU climate change policy as well as a “role model” and “pioneer” for carbon markets. 

Author(s): Andrei Marcu, Emilie Alberola, Jean-Yevs Caneill, Matteo Mazzoni, Stefan P. Schleicher, Wijnand Stoefs, Charlotte Vailles, Domien Vangenechten

Managing a Sustainable Transition to a Low-carbon Society: The Socio-economic Impacts of Mitigation

15/04/18

This policy brief looks at how to identify and manage the expected and unintended socio-economic impacts of greenhouse gas (GHG) mitigation policies. 

Author(s): Andrei Marcu, Domien Vangenechten

"Straw Man" for Article 6.2

13/02/18

This paper seeks to capture some of the issues that need to be addressed in the rulebook for article 6 of the Paris Agreement, and unpack the options for each issue, with the intention of catalyzing a discussion among Parties.

Author(s): Andrei Marcu, Peter Zaman

Issues and Options: elements for text under Art. 6

20/10/17

This paper seeks to capture some of the issues that need to be addressed in the rulebook for article 6 of the Paris Agreement, and unpack the options for each issue, with the intention of catalyzing a discussion among Parties.

Author(s): Andrei Marcu, Wijnand Stoefs, Domien Vanegenechten, Oliver Martin-Harvey, Samuel González Holguera

Addressing policy overlaps through the governance of the Energy Union

21/09/17

This paper addresses what the Governance proposal does not currently include, specifically, provisions to address interactions between elements of the Energy Union. 

Author(s): Andrei Marcu, Wijnand Stoefs and Samuel González Holguera

2017 State of the EU ETS Report

07/05/17

This report discusses the current state of play in the EU ETS while abstaining, to the extent possible, from providing solutions.

Author(s): Andrei Marcu, Emilie Alberola, Jean-Yves Caneill, Matteo Mazzoni, Stefan Schleicher, Wijnand Stoefs and Charlotte Vailles

Issues for discussion to operationalise Article 6 of the Paris Agreement

02/05/17

This paper focuses on the issues that emerged from previous discussions and submissions and which the author believes will require further examination as part of the effort to make Article 6 operational. 

Author(s): Andrei Marcu

Article 6 of the Paris Agreement Reflections on Submissions by Parties before Marrakech

02/05/17

This paper examines submissions made prior to COP 22 on views related to guidance for the Article 6 items. It highlights the many important issues covered in them and discusses implications of the various interpretations. 

Author(s): Andrei Marcu

Views on Mitigation Value and its Application

02/05/17

This paper analyses the concept of mitigation value and its application, and the relationship between mitigation value and compliance value. 

Author(s): Andrei Marcu