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dc.contributor.authorNeuhoff, Karstenen_US
dc.contributor.authorSchopp, Anneen_US
dc.contributor.authorBoyd, Rodneyen_US
dc.contributor.authorStelmakh, Katerynaen_US
dc.contributor.authorVasa, Alexanderen_US
dc.date.accessioned2012-08-24en_US
dc.date.accessioned2012-08-27T12:52:53Z-
dc.date.available2012-08-27T12:52:53Z-
dc.date.issued2012en_US
dc.identifier.urihttp://hdl.handle.net/10419/61402-
dc.description.abstractIn the European Emission Trading scheme the supply of allowances exceeds emissions - cumulating, according to our estimates, in a surplus of 2.7 billion tonnes by 2013/2014. We find that initially the surplus was acquired by power companies so as to hedge future carbon costs. As the surplus exceeds this hedging demand, additional allowances need to be acquired as speculative investment. This requires higher rates of return and implies that expected future carbon prices are highly discounted. This could explain the recent drop in carbon prices. The analysis shows that the volume of unused allowances matters for the discount applied to future carbon prices. We use our supply-demand framework to assess currently discussed policy options set-aside, reserve price for auctions and adjustments of emission targets.en_US
dc.language.isoengen_US
dc.publisherDeutsches Institut für Wirtschaftsforschung (DIW) Berlinen_US
dc.relation.ispartofseriesDiscussion Papers, German Institute for Economic Research, DIW Berlin 1196en_US
dc.subject.jelG18en_US
dc.subject.jelQ48en_US
dc.subject.ddc330en_US
dc.subject.keywordEuropean emission trading schemeen_US
dc.subject.keywordbankingen_US
dc.subject.keyworddiscount ratesen_US
dc.titleBanking of surplus emissions allowances: Does the volume matter?en_US
dc.typeWorking Paperen_US
dc.identifier.ppn72223600Xen_US
dc.rightshttp://www.econstor.eu/dspace/Nutzungsbedingungenen_US
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