Carbon Leakage in the context of increasing the EU greenhouse gas emission reduction targets – the ways the EU and global emission behave and what influences its scale

Abstract

The lack of equal globally binding GHG’s emission reduction targets is currently leading to a set of diverging GHG’s emission prices across the world (or even no price for GHG’s emission in some regions). This may result in distortions with direct implications on competitiveness of the industries in regions with strict climate policies (as the European Union) and can cause the issue of carbon leakage. Carbon leakage is defined as ‘the increase in emission outside a region as a direct result of the policy to cap emission in this region’.

Keywords

• ghg’s emission
• carbon leakage
• climate policy
• trade and the climate policy
• energy
• eu ets
• non-ets
• cge
• dynamic modelling
• low-carbon transition
• ndcs
• paris agreement