Benefits of ETS: Taking Stock of the Impacts of ETS Worldwide

First published in 2016, the paper is intended to be an accessible resource that summarizes the main conceptual and theoretical arguments for ETS, supported by a consolidated body of empirical evidence. After two years, ICAP has updated the paper with fresh evidence and up-to-date data that lends further weight to the arguments for ETS as a proven domestic climate policy instrument. The evidence shows that ETS makes both environmental and economic sense - it drives emissions reductions, incentivizes cost-effective abatement, and encourages the innovation of low-carbon technologies. Furthermore, ETS is shown to be a flexible, adaptable and politically feasible instrument that can generate public revenues and substantial co-benefits for public health and employment.

Accompanying the paper is a tool for policymakers – a spreadsheet that provides easy access to the paper’s key references.