To the top

Page Manager: Webmaster
Last update: 9/11/2012 3:13 PM

Tell a friend about this page
Print version

A Price Floor Solution to… - University of Gothenburg, Sweden Till startsida
To content Read more about how we use cookies on

A Price Floor Solution to the Allowance Surplus in the EU ETS

Authors Dallas Burtraw
Åsa Löfgren
Lars Zetterberg
Publication year 2013
Published at Department of Economics
Language en
Keywords price floor, EU ETS, suprlus, climate change
Subject categories Economics


Since 2008 there has been a rapid buildup of surplus emissions allowances in the EU ETS. The European Commission has presented six structural options to address the oversupply of allowances on a long-term basis. One option would introduce price management mechanisms, which could allow for the use of a price floor. A price floor has been mischaracterized as a tax, an instrument that has historically faced political opposition, and the commission states that an explicit carbon price objective would alter the nature of the EU ETS being a quantity-based market instrument. However, a price floor is structurally different from a tax in multiple ways, and its merits are well documented in the academic literature. This rule-based approach could reinforce the market-based philosophy and investment climate of the ETS.

Page Manager: Webmaster|Last update: 9/11/2012

The University of Gothenburg uses cookies to provide you with the best possible user experience. By continuing on this website, you approve of our use of cookies.  What are cookies?