CFAS recommended reading 8 - Using EU ETS auctioning revenues for climate action, What is the appetite for earmarking within specific EU member states? (Germanwatch, 2013)

CFAS recommended reading 8 - Using EU ETS auctioning revenues for climate action, What is the appetite for earmarking within specific EU member states? (Germanwatch, 2013)

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Date: 15th July 2013
Author: CDKN Global
Type: Feature
Organisation: Germanwatch
Tags: climate finance, Green Climate Fund, climate negotiations, UNFCCC

Authors: Anja Esch (Germanwatch) with contributions from Ilona Jedrasik (Polish Climate Coalition), Alix Mazounie and Celia Gautier (RAC France), Petr Holub (Chance for Buildings), Istvan Bart (Hungarian Energy Efficiency Institute (MEHI)), Jiri Jerabek (Greenpeace Central Eastern Europe), Niklas Kaskeala (Kepa Finland)

Date: May 2013

(Full paper available here

What it is about? The paper describes whether and if so in how far seven EU member states have directly or politically (using the equivalent value) earmarked EU ETS auctioning revenues for climate action. For each of the countries (CZ, DE, FR, FI, HU, PL, RO) a short summary is being presented on whether or not they have earmarked auctioning revenues for climate action and if so for which purposes. A more detailed description is provided for the German case, since it “is the only country within the European Union to set-up a full budgetary earmarking of its ETS revenues for national and international climate financing.” The paper comes to the conclusion that all analysed countries politically earmark some of their revenues for national or international climate action, while the final decision in Poland has not yet been taken. Finally the paper highlights that the current low certificate prices in the EU ETS pose some challenges for using the EU ETS as a predictable source for international climate finance. It is suggested that several changes should be made to repair the EU ETS and to therewith “unlock the twin potential” of reducing emissions and raising revenues with the same instrument.

Why we recommend reading it? Using EU ETS auctioning revenues for international climate finance could be one potential source for all those countries where an Emission Trading Scheme exists and certificates are being sold or auctioned off. Further, in different contexts – also outside the EU ETS – the concept of earmarking revenues for climate action comes into discussion. Therefore this paper could on the one hand provide interesting insights on the use of EU ETS revenues for climate action but also on the potential of earmarking certain revenues – also of instruments other than the EU ETS – for climate action.

 

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