Advantages and disadvantages of the benchmarks used in the EU emissions trading system during the third trading period of the EU ETS
Advantages and disadvantages of the benchmarks used in the EU emissions trading system during the third trading period of the EU ETS

Summary/Abstract: The article presents the results of an analysis of the advantages and disadvantages of the mechanism for the allocation of free tradable allowances for greenhouse gas emission from stationary installations during the third trading period of the EU ETS. Although, as of 2013, the role of this mechanism in the allocation of emission allowances within the Community has been decreasing, it remains crucial from an economic point of view. The basic method of allocation has increasingly been the sale of allowances by auction. The institutional arrangement adopted by the European Parliament and the Council and currently in force is a mechanism for the allocation of free allowances for greenhouse gas emissions based on benchmarks that vary depending on whether they are the result of temporary exemptions or derogations from the harmonized EU legal framework for emissions trading.

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