The principle of equality and the allocation rules

Once the cap has been set at a level that ensures the attainment of the environmental objective, and a market is introduced that ensures allocative efficiency, the allocation rules may be used to achieve a certain conception of fairness, subject to compliance with the principle of equal treatment and freedom of establishment. Indeed, differential treatment is only the first step in finding a breach of equality, the second being that the difference cannot be justified. The CFI has acknowledged...

The Setting of the

Article 9 Directive 2003 87 EC mandates Member States to fix the cap that applies to their industries. Criteria 1 to 4 and 12 of Annex III of the Directive guide the setting of the cap. The main requirements are compliance with the Kyoto Protocol, proportionality in the distribution between covered and non-covered sectors, and consistency with the national climate change programme. Annex III has been interpreted further by the Commission in a non-paper and in two guidance documents.65 However,...

Interpretations Of The Polluterpays Principle

Let us begin our analysis by emphasizing that principles are not rules they are characterized by relatively vague formulations. For this reason, understanding the polluter-pays principle is more complex than its wording may suggest. A principle states '( ) a reason that argues in one direction, but does not necessitate a particular decision' (Dworkin, 1977 26). Therefore, principles work as guidelines different outcomes might result from the application of a principle since it does not dictate...

Preliminary Comparison Between Ex Ante And Ex Post Assessments Of The Eu

Ex ante assessments, such as those presented in Section 2, assumed that EUAs would be treated as 'normal' factors of production by the firms covered by the EU ETS, even if the allowances were given free of charge. This means that decision-makers in these firms would consider the opportunity costs of the allowances in their production decisions. Evidence (at least from the power sector) supports this assumption. The ex ante assessments commonly modeled the EU ETS as being equivalent to the...

Regional Ghg Regimes In The United States Regional Greenhouse Gas Initiative

The Regional Greenhouse Gas Initiative (RGGI, pronounced 'REGGIE') was the first regional cap-and-trade program established in the United States. On 20 December 2005, the eastern states of Connecticut, Delaware, Maine, New Hampshire, New Jersey, New York, and Vermont agreed to establish statewide carbon dioxide (CO2) emission caps. Massachusetts, Rhode Island, and Maryland later joined RGGI, adopting similar CO2 emission caps. RGGI operates within a few different regional transmission...

Do Polluters Pay Under Grandfathering

Rather than examining the law, we use economic theory to answer the question of whether polluters pay under grandfathering. Under grandfathering, polluters receive their emission rights free of charge, whereas under auctioning, polluters have to purchase the allowances. Nash 2000 13 finds that ' grandfathering runs contrary to the polluter pays principle's core, violating even the principle's weak form'. He states 'The core of the polluter pays principle argues that neither the government nor...

References

Skinner 2005 , 'The European Union's Approach to Reducing Greenhouse Gas Emissions', Journal for European Environmental and Planning Law JEEPL p. 92. Arnulli, A. 1995 , 'Private applicants and the action for annulment under Art.173 of the EC Treaty', CMLR, p. 7. Barton, J. 2006 , 'Tackling Aviation Emissions the Challenges Ahead', JEEPL, Berlin, The Lexxion Publisher, Volume 3, Number 4, p. 322. Comhaire, G. 2001 , 'En route pour l'industrie verte', La Libre Belgique, 23...

Abuse

Whether national measures taken within the framework of the EU ETS system that impact the propensity to abuse could be declared incompatible with the common market on the basis of a joined application of Articles 3 g , 10 2 and 82 EC Treaty constitutes a far from trivial question. This is particularly so in light of the considerable gaps existing in the Courts interpretations to this date. A national measure can only be declared incompatible with the Community law if it 1 gives rise to...

The Legal Perspective

From economic literature, we learn that the efficiency and the effectiveness of the regulatory approach through emissions trading are attractive factors.14 It is exactly stemming from these instrumental characteristics that emissions trading has become so popular in the field of climate change policy it simply saves money when using this instrument. When we put the emissions trading instrument, which is in fact an economic instrument, into a legal perspective, a hurdle has to be jumped. It is...

Case Law Regarding Ex Post Adjustments

This section gives an overview of the most important case law regarding ex post adjustments. First, we discuss some national case law as delivered in Belgium, The Netherlands and Germany, after which we elaborate on case law from the Court of First Instance in which the rejection by the Commission of ex post adjustments as proposed by Germany was found not acceptable. 4.2 National Case Law 4.2.1 The Netherlands Within the Netherlands, the issue of ex post interventions was considered in the...

Edward Elgar

Cheltenham, UK Northampton, MA, USA The Editors and Contributors Severally 2008 All rights reserved. No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form or by any means, electronic, mechanical or photocopying, recording, or otherwise without the prior permission of the publisher. Edward Elgar Publishing, Inc. William Pratt House 9 Dewey Court Northampton Massachusetts 01060 USA A catalogue record for this book is available from the British...

Problem Definition Reasons For This Book

Emissions trading can no longer be seen as just an interesting theoretical exercise this market-based approach has developed an increasingly important role, first within the environmental law framework of the USA and later also within that of the EU. The instrument of emissions trading has been applied in order to combat significant environmental problems like acid rain, ozone-depleting substances and climate change. Regarding the two latter problems, the instrument is applied both on the...

Structure Of The Book

As the table of contents shows, the book is divided into four parts and fourteen chapters. This first part contains this editorial foreword drafted by the editors, followed by a general introduction concerning the legislative choices within the European greenhouse emissions trading scheme by Marjan Peeters in chapter 2. Part 2 discusses the greenhouse gas emissions trading system in the EU from a critical economic and legal perspective. Javier De Cendra de Larragan addresses the allocation of...

The Interpretation Of The Commissions Guidelines

Under Article 211 of the EC Treaty, the Commission is charged with ensuring that the provisions of the Treaty and the measures taken by the institutions pursuant to the Treaty are applied. 'This means the Commission has been given primary responsibility for monitoring the application of European law in the Member States.'53 The most important instrument at the Commission's disposal is the procedure laid down in Article 226. This provides that the Commission may bring a matter before the Court...

The Problem Of Emissions Leakage

Emissions leakage occurs when there is 'a reduction in emissions of greenhouse gases within the state that is offset by an increase in emissions of greenhouse gases outside the state.'43 The United States Environmental Protection Agency EPA notes that emissions leakage 'occurs when economic activity is shifted as a result of the emission control regulation and, as a result, emission abatement achieved in one location that is subject to emission control regulation is offset by increased...

The Principle of Equality Criteria for its application

The principle of equality in Community law functions both as a powerful tool for pursuing ever deeper Community-wide harmonization within the internal market and, in the hands of the European courts, to test the legality of Community and domestic legislation implementing the former. The principle of equality as applied by the European courts requires that competitors are treated similarly, and that differential treatment be objectively justified. In general, two elements are required to...

Word Of Thanks

As editors of this book we are grateful to all contributors for their willingness to participate in this highly interesting and challenging project and for meeting the stringent deadlines we imposed upon them. The METRO Institute has for many years received support from a consortium of industries for carrying out research into the legal and economic aspects of emissions trading.10 Moreover, The Netherlands Ministry of the Environment VROM sponsored a research team which evaluated the reform of...

Introduction

While many may view the United States of America's refusal to participate in the Kyoto Protocol as a strategic effort to undermine mandatory greenhouse gas GHG reduction targets - a view not without some merit, regional efforts to combat climate change within the United States can provide valuable information about the design of effective regional GHG emissions trading schemes outside the United States. Indeed, despite the United States' reluctance to join the Kyoto Protocol and accept...

Appendix

Questions asked to the Court of First Instance After the approval decision of the Commission, can a Member State freely modify all the propositions of its national allocation plan NAP or only the propositions previously rejected by the Commission Case T-178 05 - United Kingdom v. Commission - 23 November 2005 . Can a competitor, under a national allocation plan, receive an advantage that an comparable company cannot receive Is the Commission's decision, concerning the economical validity of the...

Emission Trading And State

This section examines to what extent the State aid provision of EC Competition law guides Member States to select the least distortive allocation format. As in the previous section, the two free allocation mechanisms examined are grandfathering and the Performance Standard Rate System. In order to address this question, first it has to be established if both allocation mechanisms fall within the ambit of the State aid rules and which one of them gives rise to less anticompetitive concern. Given...

Carbon Emission Trading Law And Economics

Stewart 1984 , 'Comment Reforming Environmental Law', Stanford Law Review, 37 5 , 1333-65. Ackerman, B.A. and R.B. Stewart 1988 , 'Reforming Environmental Law The Democratic Case for Market Incentives', Columbia Journal of Environmental Law, 13, 171-99. Baldwin, R. 2008 , 'Regulation Lite The Rise of Emissions Trading', Law Society Economy Working Papers, and http ssrn.com abstract 1091784. Van Calster, G. 2008 , 'Against Harmonisation - Regulatory Competition in Climate...

Ex Post Analysis Of The First Phase Of Eu

Historic Eua Prices

Has the EU ETS met its expectations by delivering emissions abatement at least cost And has the EU ETS negatively affected the competitiveness of European industry or industrial sectors The first phase of the EU ETS 2005-2007 has come to an end, and as data of this phase are being collected, processed and published, researchers can start addressing these questions in a quantitative way. 3.1 A Closer Look at the Market for EU Allowances EUAs Prices and Volumes Three major types of markets for...

The Polluter Pays Principle

The polluter pays principle is defined neither in the EC Treaty nor in the case law of the European courts. Article 175 EC refers to it as one of the guiding principles of Community law, and it is at the basis of the guidelines on environmental state aid.27 The ECJ related the polluter pays principle to the principle of proportionality in Standley.28 In that case, a number of farmers 25 Van den Bergh 1996, p. 364 . 27 Community Guidelines on State Aid for Environmental Protection, OJ C 82,...