The EU Emissions Trading System (EU ETS) leads to higher electricity prices and thus higher costs for electricity-intensive industries in the EU, reducing their competitiveness compared to those in non-EU countries. This disparity may result in carbon leakage, where production shifts abroad,...

Döbbeling-Hildebrandt et al. (2024, DH2024) conduct a meta-analysis of the effectiveness of carbon pricing. DH2024's abstract concludes that 17 of 21 schemes evaluated in the literature produced substantial emissions reductions. A subsequent press release was headed: "Carbon pricing works"....

Companies across industries seek to assess the costs of complying with environmental regulations and meeting voluntary emission targets. This paper develops a carbon abatement cost model for firms operating a portfolio of assets with differing cost or load profiles. The resulting abatement cost...

Since the Industrial Revolution, the increase in greenhouse gas emissions has led to a significant rise in global temperatures compared to the pre-industrial period. This development has heightened the importance of carbon pricing policies in combating climate change. This study aims to examine...

Despite the strong commitment of European countries to achieve net-zero emissions by 2050, the extent to which key policies and drivers jointly shape emissions dynamics remains insufficiently investigated. To fill this gap, the study investigates the combined effects of the circular economy,...

The overarching aim of this report is to help Moldova meet its climate commitments, advance EU integration, and foster inclusive economic growth, while safeguarding vulnerable households and businesses throughout the transition. Achieving these objectives requires careful policy design that...

In European day-ahead electricity markets, carbon allowance costs passed through by marginal fossil plants raise consumer expenditure and generate inframarginal rents for non-emitting generators. We propose a settlement modification: when the zonal day-ahead price exceeds a threshold,...

This paper examines the limits of corporate governance as a tool for advancing climate transition. While capital market mechanisms, shareholder stewardship, say-on-climate votes, and ESG-linked executive compensation are often presented as effective levers for greening corporate behavior, their...

This publication analyses the advantages and disadvantages of carbon credits compared to other financing instruments for protecting and restoring coastal ecosystems. Nine instruments are examined, including emission credits, biodiversity certificates, development cooperation, and blue bonds....

This paper argues that current carbon accounting overlooks an important part of climate action: avoided emissions, or emissions that never occur because cleaner products, services, or decisions replace higher-carbon alternatives. While companies are increasingly developing solutions that reduce...

This report examines the risks and opportunities of using carbon crediting mechanisms to fund the protection and restoration of coastal ecosystems. It evaluates seven projects registered in the voluntary carbon market, focusing on key challenges related to integrity risks such as additionality,...

We experimentally investigate how the timing of, and commitment to, an environmental regulation affects efficient technology adoption under emission taxes and tradable permits. An environmental regulator can either commit ex-ante to a specific policy level or ex-post to a rule on how to adjust...

The European Union Emissions Trading System is set to substantially increase the effective carbon price faced by airlines. To quantify the impact of this carbon regulation on the European airline industry, we estimate a two-stage model of airline competition with endogenous route entry, flight...

Financial markets and foreign investments could play an effective role in determining the environment and income of GCC resource-rich economies. Therefore, the effects of Financial Market Development (FMD) and Foreign Direct Investment (FDI) on Carbon Intensity (CI) from oil, gas, gas flaring,...

To address climate change and fulfill its international commitments to reducing carbon emissions, China has accelerated the low-carbon transformation of the thermal power sector through a carbon trading mechanism. However, as the "30·60″ dual-carbon target approaches, the carbon market still...

Sustainable aviation fuels (SAFs) are promising solutions for reducing carbon emissions in the aviation industry and achieving the 2050 net-zero target. Despite their environmental benefits, the adoption and deployment of SAFs remain significantly below expectations. This paper systematically...

This paper develops a welfare and public economics perspective on optimal policies for carbon removal and storage (CDR) in permanent and non-permanent sinks. Non-permanent CDR reduces mitigation costs, even though the stored carbon is released into the atmosphere eventually. It may serve as...

Firms' efforts to reduce pollution emissions in their production processes are induced by market forces as well as governmental regulatory instruments. The market forces, which might induce firms to increase production to maximize profits, work at cross-purposes. One of the common solutions is...

The EU Emissions Trading System (EU ETS) leads to higher electricity prices and thus higher costs for electricity-intensive industries in the EU, reducing their competitiveness compared to those in non-EU countries. This disparity may result in carbon leakage, where production shifts abroad,...

The EU Carbon Border Adjustment Mechanism (CBAM) came into force on 1 October 2023, introducing reporting requirements for importers of covered products and, from 2026, an obligation to pay a fee on the carbon content of imported goods. This paper uses indices of ad valorem tariffs to assess the...

Carbon leakage is a major concern in the design of unilateral climate policies aimed at reducing global emissions in a cost-effective manner. In order to assess the cost-effectiveness of anti-leakage measures, it is crucial to understand the fundamental mechanisms that contribute to leakage. We...

The study examines economic growth and climate change when system competition between countries causes drastic changes in their climate policies. The world is divided into two groups of countries: one that implements strict climate policies and another that refrains from doing so due to concerns...

This paper examines how income inequality affects environmental outcomes through the interplay of household consumption and political support for climate policy. We develop an agent-based model in which households differ by income, consumption patterns, and climate policy attitudes. Our results...