|Project name:||Effect - Effective unilateral climate policy: Complementing the EU ETS|
|Project leader:||Karl Steininger|
|Project team:||Stefan Nabernegg (PhD student)|
|Duration:||Nov. 2015 - Oct. 2018|
EU climate policy under only partial global compliance raises concerns regarding competitiveness and carbon leakage. To counter such concerns, border adjustment measures are discussed. For the analysis of their impact multiregional CGE model frameworks are used. While a dominant share in trade exposed energy intensive sectors (steel, cement) emissions are process emissions, most models so far cover combustion emissions only. We expand the multiregional CGE analysis in three dimensions. (1) process emissions are included to cover leakage implications of EU climate policy and the effectiveness of border carbon measures more adequately, (2) possible technology switches for major emitting activities towards a renewable electricity base (e.g. electric steel process) are modelled, including larger-scale solar electricity supply, (3) the relative benefits of other technology policies to complement the ETS instrument are evaluated in our dynamic CGE framework. Fostering the ultimate objective of global emission reduction, we thus identify core elements so that a unilateral climate policy can effectively achieve those goals.