Publications

As market-based instruments, emissions trading systems are inherently flexible, as entities can decide to reduce their own emissions or buy emissions allowances from the market. Carbon offsets (or simply ‘offsets’) are a tool to further increase flexibility in reaching climate targets under ETSs, as they offer sectoral and geographical flexibility for jurisdictions to reduce greenhouse gas emissions outside of the scope of their ETS. This report …

Benchmarking can protect against carbon leakage while setting incentives to reduce emissions, but their design entails complex trade-offs. This paper explores benchmark-based industrial allocation design and experiences, using insights from existing ETSs, and their implications for abatement and low-carbon investment incentives.

Given factors such as constraints in free allocation policy for some ETS jurisdictions, other ways of addressing concerns about carbon leakage and competitiveness are likely to continue attracting interest, and these approaches may increasingly focus on cross-border trade. California and New Zealand offer practical experiences with such policies that may be instructive for other jurisdictions navigating border-related climate measures.

Current estimates suggest achieving net-zero emissions will require much higher carbon prices. What challenges could arise? A brief on the possible policy options to address them.

A technical note on carbon market simulations as a means to allow stakeholders to participate in a fictitious process of designing or participating in an ETS.

This paper explores different market stability mechanisms (MSMs) used in ETSs around the world to balance policy predictability with the need for flexibility to respond to changing circumstances or unexpected shocks.

This report examines how different emissions trading systems (ETSs) manage and distribute revenue generated from auctioning allowances. Directing revenue from auctions toward projects that generate tangible benefits is a key way to increase the political and social acceptability of an ETS.

An accessible resource that summarizes the main conceptual and theoretical arguments for ETS, supported by a consolidated body of up-to-date empirical evidence.

A summary of key insights from the literature with a focus on the technical dimensions of linking ETS.

Key elements for emissions trading market oversight: an overview, including insights on institutional and legal requirements and standards.