Emissions Trading: Impact on Electricity Prices and Energy-Intensive Industries

The EU-wide Emission Trading Scheme (ETS), established in 2005, is a key pillar of Europe¿s strategy to attain compliance with the Kyoto Protocol. Under this scheme, CO2 allowances have thus far been allocated largely free of charge. This paper demonstrates that such cost-free allocation, commonly called grandfathering, implies an increase in electricity prices even when strong competition prevails on electricity markets. As our estimations for Germany¿s power sector show, these price increases result in substantial windfall profits, giving rise to public skepticism and calls for an auctioning of certificates in the future. While empirical evidence on the ETS¿ impacts is scant, the findings reviewed here indicate that even in the absence of certificate auctioning, energy-intensive industry sectors, such as primary aluminum production, may suffer heavily from the ETS-induced electricity price increases. We therefore argue that an abrupt transition to a complete auctioning system may endanger the competitive position of energy-intensive industries in Europe, unless all other major industrial and transition countries are integrated into a global emissions trading system

Uptake and depuration of gold nanoparticles in Daphnia magna

This study presents a series of short-term studies (total duration 48 h) of uptake and depuration of engineered nanoparticles (ENP) in neonate Daphnia magna. Gold nanoparticles (Au NP) were used to study the influence of size, stabilizing agent and feeding on uptake and depuration kinetics and animal body burdens. 10 and 30 nm Au NP with different stabilizing agents [citrate (CIT) and mercaptoundecanoic acid (MUDA)] were tested in concentrations around 0.5 mg Au/L. Fast initial uptake was observed for all studied Au NP, with CIT stabilized Au NP showing similar rates independent of size and MUDA showing increased uptake for the smaller Au NP (MUDA 10 nm > CIT 10 nm, 30 nm > MUDA 30 nm). However, upon transfer to clean media no clear trend on depuration rates was found in terms of stabilizing agent or size. Independent of stabilizing agent, 10 nm Au NP resulted in higher residual whole-animal body burdens after 24 h depuration than 30 nm Au NP with residual body burdens about one order of magnitude higher of animals exposed to 10 nm Au NP. The presence of food (P. subcapitata) did not significantly affect the body burden after 24 h of exposure, but depuration was increased. While food addition is not necessary to ensure D. magna survival in the presented short-term test design, the influence of food on uptake and depuration kinetics is essential to consider in long term studies of ENP where food addition is necessary. This study demonstrates the feasibility of a short-term test design to assess the uptake and depuration of ENP in D. magna. The findings underlines that the assumptions behind the traditional way of quantifying bioconcentration are not fulfilled when ENPs are studied.Peer reviewed: YesNRC publication: Ye

Targeting macrophage Histone deacetylase 3 stabilizes atherosclerotic lesions

Macrophages are key immune cells found in atherosclerotic plaques and critically shape atherosclerotic disease development. Targeting the functional repertoire of macrophages may hold novel approaches for future atherosclerosis management. Here, we describe a previously unrecognized role of the epigenomic enzyme Histone deacetylase 3 (Hdac3) in regulating the atherosclerotic phenotype of macrophages. Using conditional knockout mice, we found that myeloid Hdac3 deficiency promotes collagen deposition in atherosclerotic lesions and thus induces a stable plaque phenotype. Also, macrophages presented a switch to anti-inflammatory wound healing characteristics and showed improved lipid handling. The pro-fibrotic phenotype was directly linked to epigenetic regulation of the Tgfb1 locus upon Hdac3 deletion, driving smooth muscle cells to increased collagen production. Moreover, in humans, HDAC3 was the sole Hdac upregulated in ruptured atherosclerotic lesions, Hdac3 associated with inflammatory macrophages, and HDAC3 expression inversely correlated with pro-fibrotic TGFB1 expression. Collectively, we show that targeting the macrophage epigenome can improve atherosclerosis outcome and we identify Hdac3 as a potential novel therapeutic target in cardiovascular disease

Screening of a PDE-focused library identifies imidazoles with in vitro and in vivo antischistosomal activity

We report the evaluation of 265 compounds from a PDE-focused library for their antischistosomal activity, assessed in vitro using Schistosoma mansoni. Of the tested compounds, 171 (64%) displayed selective in vitro activity, with 16 causing worm hypermotility/spastic contractions and 41 inducing various degrees of worm killing at 100 μM, with the surviving worms displaying sluggish movement, worm unpairing and complete absence of eggs. The compounds that did not affect worm viability (n = 72) induced a complete cessation of ovipositing. 82% of the compounds had an impact on male worms whereas female worms were barely affected. In vivo evaluation in S. mansoni-infected mice with the in vitro ‘hit’ NPD-0274 at 20 mg/kg/day orally for 5 days resulted in worm burden reductions of 29% and intestinal tissue egg load reduction of 35% at 10 days post-treatment. Combination of praziquantel (PZQ) at 10 mg/kg/day for 5 days with NPD-0274 or NPD-0298 resulted in significantly higher worm killing than PZQ alone, as well as a reduction in intestinal tissue egg load, disappearance of immature eggs and an increase in the number of dead eggs

'Windfall Profits 2.0' During the Third Phase of the EU-ETS

The first two phases of the EU-ETS were characterized by a profit increase, which was primarily due to free allowances given through grandfathering. To avoid these windfall profits and to decrease leakage, two major modifications have been implemented for the third phase: electric companies no longer receive free allowances, while energy intensive and trade exposed sectors are granted free allowances that are calculated based on firm production capacity. This paper theoretically shows a new type of profit increase in sectors that are not exposed to international competition. This paper also illustrates the profit increase for the third phase of the EU-ETS and shows that profits in the electricity sector may increase by approximately 2% when free allowances are given to the other sectors

How Emission Certificate Allocations Distort Fossil Investments: The German Example

Despite political activities to foster a low-carbon energy transition, Germany currently sees a considerable number of new coal power plants being added to its power mix. There are several possible drivers for this dash for coal, but it is widely accepted that windfall profits gained through free allocation of ETS certificates play an important role. Yet the quantification of allocation-related investment distortions has been limited to back-of-the envelope calculations and stylized models so far. We close this gap with a numerical model integrating both Germany's particular allocation rules and its specific power generation structure. We find that technology specific new entrant provisions have substantially increased incentives to invest in hard coal plants compared to natural gas at the time of the ETS onset. Expected windfall profits compensated more than half the total capital costs of a hard coal plant. Moreover, a shorter period of free allocations would not have turned investors' favours towards the cleaner natural gas technology because of preexisting economic advantages for coal. In contrast, full auctioning of permits or a single best available technology benchmark would have made natural gas the predominant technology of choice