What Can We Learn from EU ETS?

Overall, the EU Emissions Trading System (EU ETS) is an effective instrument for reducing greenhouse gas (GHG) emissions. In an article published today in CESifo DICE Report, PBL researchers Herman Vollebergh and Corjan Brink conclude that the EU ETS guarantees a credible and binding reduction in emissions in the sectors to which the regulation applies. The article describes a number of lessons learned in the EU, which other economic regions across the globe could also take into account when trying to effectively reduce greenhouse gas emissions.