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Linking Existing and Proposed GHG Emissions Trading Schemes in North America

Linking Existing and Proposed GHG Emissions Trading Schemes in North America

Linking emissions trading schemes has currently attracted much interest as a means of reducing compliance costs, expanding market size and liquidity, and reducing price volatility. The US and Canada are developing federal emissions trading systems, and Mexico is developing an emissions cap for its cement and oil sectors. Strong economic ties imply that linking the systems could become desirable. Linking systems can have both positive and negative implications, but once the decision has been made, framework and policy harmonization is vital to establish and maintain a successful link. Michael Mehling of the Ecologic Institute in Washington DC co-authored this article.

At present, the Canadian emissions reduction target based on emissions intensity is the biggest obstacle to bilateral linkages between the US and Canada. Moving to a system based on a hard cap in Canada would facilitate links between the systems. North American systems can expand on the present cooperation of regional systems and create bilateral linkages.

Linking emissions trading schemes has attracted much interest as a means of reducing compliance costs, expanding market size and liquidity, and reducing price volatility. The latest issue of Climate Policy exclusively addresses the challenges and prospects of linkages between emissions trading systems.

The article Linking Existing and Proposed GHG Emissions Trading Schemes in North America is available online.


Citation

Haites, Erik and Michael Mehling 2009: “Linking Existing and Proposed GHG Emissions Trading Schemes in North America”. Climate Policy, Vol. 9, No. 4, 373-388.

Language
English
Author(s)
Erik Haites
Publisher
  • earthscan, United States
Year
2009
Published In
Journal: Climate Policy , Vol. 9 | No. 4
ISSN
1469-3062 (Print), 1752-7457 (Online)
Dimension
16 pp.
Table of Contents
  1. Introduction
  2. Background
  3. Existing and proposed emissions trading schemes
    3.1 Membership of regional emissions trading schemes
    3.2 Emissions trading schemes
          3.2.1 Alberta
          3.2.2 Regional Greenhouse Gas Initiative
          3.2.3 Western Climate Initiative
          3.2.4 Midwestern Regional Greenhouse Gas Reduction Accord
          3.2.5 Florida
          3.2.6 Canada
  4. Overlap of national and state/provincial emissions trading schemes
    4.1 United States of America
    4.2 Canada
  5. Prospects for linking US and Canadian emissions trading schemes
    5.1. Linking scenarios for the USA
           5.1.1. A federal scheme only
           5.1.2 A federal scheme together with one or more state schemes
           5.1.3 Multiple regional schemes
    5.2 Linking scenarios for Canada
          5.2.1. A federal scheme only
          5.2.2 A federal scheme and one or more provincial schemes
          5.2.3 A revised federal scheme linked with a federal scheme in the USA
  6. Conclusions
Keywords
climate, emissions trading, carbon market, linking, North America