Abstract
Next to energy efficiency, in the context of GHG reductions, additional policy mechanisms to the incumbent EU Emissions Trading scheme (EU ETS) are discussed. Such is the case of Non-ETS Domestic Offset (DO) schemes, which can reduce CO2-eq.emissions in the non-ETS sectors and trade these as CO2 credits on the ETS market. Taking into account that the EU’s “Linking Directive” (EC 2004) creates the conditions to use credits generated by emission reduction projects certified by the UN Framework Convention on Climate Change Kyoto Protocol (KP) within the EU ETS market, in this paper we employ the institutional analysis method of interactions in order to provide insight of a combined White Certificates (WhC) and DOs cheme. Special attention is paid to the parameters that seem to hamper harmonization of WhC and DO. Aim of this paper is to discuss whether smart market- based instruments, such as WhC, can be complementary to the effectiveness of mechanisms fostering energy efficiency such as DOs projects and vice versa. In this respect, the potential combined scheme is assessed (ex-ante) with the help of standard criteria that refer to the triptych energy, environment & society. Given the outcome of the study made, it is fair to say that such a DO/WhC combined scheme could be selected if the additionality concern is to minimize short term social costs of reaching a certain goal. However recent information and research conducted so far cannot yet uphold an ambition that a WhC/DO scheme of this kind could also drive technical change, keep consumer costs down and be equitable.
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Notes
JI is the project based mechanism under the KP that targets emission reductions in Annex 1 or developed country economies, including the EU, Australia, Belarus,1 Canada, Croatia, Japan, Kazakhstan, Lichtenstein, Monaco, New Zealand, Norway, Russia, Switzerland, Turkey and Ukraine.
More information on the DO schemes globally can be found in the NEON network webpage (http://www.jiqweb.org/index.php/domestic-offsets/non-ets-offset-workshop)
Meaning the net present value of total kWh of final energy over the life of a product (or in other words cumac=Annual Energy Savings * Lifetime of energy saving actions (discounted at a rate of 4%)).
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Acknowledgements
This article is a joint effort of the expert NEON (Non-ETS Offset Projects) network, which is a think tank on the promotion of domestic offset projects for climate change mitigation. More in detail, the authors would like to thank their co-members of NEON: Andreas Tuerk and Daniel Steiner (Joanneum Institute, Austria), Daniele Russolillo (Fondazione per l’Ambiente, Italy), Liviu Gheorghe (eco2ro, Romania), Fabio Iraldo (CE.SI.SP, Italy), Lorena Jurado (General Council of Catalan Chambers of Commerce, Spain), Benoit Leguet, Ariane de Dominicis and Elise Stoffaes (CDC Climat, France), Jos Cozijnsen (Emissierechten, the Netherlands), Andrew Prag (Carbon Markets and Investors Association), Adriaan Perrels (VATT, Finland), Zsolt Lengyel (SQS), and Benet Hermind (Danish Energy Agency). Furthermore, the authors would like to thank Prof. Catrinus Jepma for the review of our article and the provision of fruitful comments and useful suggestions. Finally, the authors would like to thank the two anonymous reviewers who have contributed significantly to the quality improvement of this article.
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Oikonomou, V., Flamos, A., Spyridaki, NA. et al. White certificates and domestic offset schemes: possible synergies. Mitig Adapt Strateg Glob Change 17, 187–205 (2012). https://doi.org/10.1007/s11027-011-9320-z
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DOI: https://doi.org/10.1007/s11027-011-9320-z