In this paper we analyse the behaviour of the EU market for CO2 emission allowances; specifically, we focus on the contracts maturing in the Kyoto Protocol's second period of application (2008 to 2012). We calibrate the underlying parameters for the allowance price in the long run and we also...

As the EU Emission Trading Scheme (EU ETS) moves towards its third phase (2013–2020) it has undergone numerous improvements, including a gradual increase in the use of auctions as a distribution mechanism and the prevalence of sectoral criteria over National Allocation Plans. At the same time,...