EU enlargement and environmental policy

The Eastern European Associates (EEA) have committed to reduce greenhouse gas emissions according to their targets set in the Kyoto Protocol. Furthermore since 1993 trade liberalization has taken place between all associated countries and the EU. There is meanwhile a large quantitative literature on the economic effects of full integration of the associated countries into the EU as well as on the Kyoto Protocol. However, there is a lack of quantitative research on the linkage of trade and the environment in the context of the EU enlargement. In this paper we analyze the interactions of different environmental policies under the Kyoto Protocol and trade liberalization in the process of eastern enlargement using a computable general equilibrium model. We find that trade liberalization provides large gains for EEAs while it holds only modest gains for EU member states. Integration does not show a significant impact on carbon abatement policies, but mitigates associated welfare losses. --EU enlargement,Kyoto Protocol,computable general equilibrium modeling

EU Enlargement and Environmental Policy

The Eastern European Associates (EEA) have committed to reduce greenhouse gas emissions according to their targets set in the Kyoto Protocol. Furthermore since 1993 trade liberalization has taken place between all associated countries and the EU. There is meanwhile a large quantitative literature on the economic effects of full integration of the associated countries into the EU as well as on the Kyoto Protocol. However, there is a lack of quantitative research on the linkage of trade and the environment in the context of the EU enlargement. In this paper we analyze the interactions of different environmental policies under the Kyoto Protocol and trade liberalization in the process of eastern enlargement using a computable general equilibrium model. We find that trade liberalization provides large gains for EEAs while it holds only modest gains for EU member states. Integration does not show a significant impact on carbon abatement policies, but mitigates associated welfare losses

The impact of OECD Agricultural trade liberalization on poverty in Uganda

The paper examines the projected impacts of agricultural trade liberalisation by OECD countries on poverty in Uganda and compares them to the poverty impacts of all merchandise trade liberalisation. The overall impact of OECD agricultural trade liberalisation on welfare in Uganda from this simulation is positive in contrast to previous research, nevertheless, the poor appear to be made worse off. The liberalisation of all OECD merchandise trade including non-agricultural commodities reduces welfare for all deciles irrespective of household poverty status, residence and region. The results for global partial merchandise trade liberalisation are similar to those for total trade liberalisation with an overall welfare decline of about 0.5 percent. More specifically, even the modest welfare gains for producers from increased prices seem to be offset by welfare losses from increases in consumer goods. Overall, because of the large subsistence agricultural sector, households tend to experience little or no change in total welfare arising from agricultural price changes. Increases in market value of their agricultural based output tend to be offset by changes in the opportunity cost of their subsistence consumption of the bulk of that output.Microsimulation, agricultural trade liberalization, Uganda , poverty

EU Petroleum Refining Fitness Check: OURSE Modelling and Results

The OURSE (Oil is Used in Refineries to Supply Energy) model is used to assess ex post the likely impact on the performance and international competitiveness of the EU refineries of the main EU legislation included in the EU Petroleum Refining Fitness Check (REFIT) study. Given the (dis)similar nature of the immediate (i.e. direct) impact mechanisms of the legislation acts on refining industry, the considered directives were grouped into the following three (broader) categories for modelling purposes: 1. Fuel quality specifications change due to the Fuels Quality Directive (FQD) and Marine Fuels Directive (MFD); 2. Demand levels and composition change due to the requirements of the Renewable Energy Directive (RED) and Energy Taxation Directive (ETD); and 3. Sulphur dioxide emissions limits change as implied by the requirements of the Large Combustion Plants Directive (LCPD), Integrated Pollution Prevention and Control Directive (IPPCD) and Air Quality Directive (AQD).JRC.J.5-Sustainable Production and Consumptio

EU Petroleum Refining Fitness Check: Impact of EU Legislation on Sectoral Economic Performance

This report presents the results of the quantitative assessment of the impact on the petroleum refining sector of legislative measures, identified in the process of European Commission's analysis and stakeholder consultations as being of significant relevance for petroleum refineries, and as such included in the mandate of the fitness check. This quantitative assessment took into account the impact of the legislation on costs and revenues of the EU petroleum refining industry and therefore on its capacity to remain internationally competitive. This analysis, mostly of a quantitative nature, was accompanied where possible and relevant by a qualitative assessment in accordance with the Commission's general approach to fitness checks . In particular, the report analysed how coherently and consistently the EU legislation, identified as relevant for the sector, works together, whether it is effective and efficient, and whether it is associated with excessive regulatory burdens, overlaps, gaps, inconsistencies or obsolete measures. Since this fitness check addressed a specific industry sector rather than a policy area, it had a specific focus on the cumulative impact, effectiveness, efficiency and coherence of the measures with respect to the oil refining sector. As stated in the mandate of the fitness check, the analysis in this report was retrospective and concentrated on the impact of the relevant legislation on the petroleum refining sector in the period between 2000 and 2012.JRC.J.5-Sustainable Production and Consumptio

ETS alignment : a price collar proposal for carbon market integration

The global carbon market landscape is fragmented and increasingly complex. The conclusions reached at COP26 in Glasgow on the Article 6 rulebook are expected to achieve further mitigation using market mechanisms, facilitate the coordination of international efforts and increase carbon market integration. Three sets of conditions are necessary for smoothing the linking of emissions trading systems (ETSs). Before negotiations, mutual trust is crucial to respond to unexpected developments in partners’ economic, social and political circumstances. During the linking negotiations, a degree of alignment of core design features of ETSs is necessary to harmonise the systems. After the completion of negotiations, built-in reviews and broad-based consultations, as well as mechanisms for revision, dispute resolution and potential future delinking, are fundamental to ensure that linking works over time. The degree of alignment necessary for linking is a critical issue. Some ETS features (e.g., the price control mechanisms) require compatibility, whereas other key design elements (e.g., the stringency of the cap) may not require strict compatibility if they lead to comparable outcomes. Other ETS design features (e.g., the allocation phases and compliance periods) would benefit from coordination but do not need to be aligned. When ETSs are linked, the efficiency gains from allowance trade are enhanced compared to autarky (pre-link levels), as domestic and foreign allowance prices fully or partially (in case of linking with quotas) converge to an intermediate level. The price risk of linking could be constrained by enforcing a price collar (i.e., a price floor and a price ceiling) for the linked system. The price collar could be specified by the intersection between the two respective intervals representing acceptable post-link allowance prices. Options for enforcing the price ceiling include releasing allowances from a joint cost-containment reserve. To enforce the floor, allowances can be allocated in auctions with a reserve price equal to the floor. Alternatively, a ‘top-up’ carbon tax could be applied to allowances that are auctioned at a price below the floor. The price collar could help jurisdictions to mitigate systemic shocks that may affect allowance prices like recession, unanticipated growth, technological leaps that lower the abatement cost of emissions, as well as changes in companion climate policies. Reducing price risk and uncertainty would be beneficial for regulators, regulated entities and investors. However, reaching an agreement on the parameters and rules of a price collar in the linked system can be difficult. Early and open dialogue between the ETSs is strongly recommended to overcome these challenges

Improving the European input–output database for global trade analysis

There are increasing numbers of published articles in the feld of input–output analysis and modelling that use the GTAP input–output database; particularly, in relation to the estimation of carbon, energy and water footprints and the analysis of global value chains and international trade. The policy relevance of those topics is also increasing, thus calling for consistently linking these databases with ofcial statistics. Although, so far, GTAP has been using their own classifcation and reconciliation methods, this paper develops a new conversion method for the EU that guarantees that the EUGTAP database respects the new statistical standards and Eurostat ofcial statistics. We recommend for future updates, a shift of the current GTAP classifcation of industries to the new ofcial standard classifcations to which countries are progressively moving to. Otherwise, the lack of matching ofcial data would jeopardize the usefulness of such database. This method can be extended to other similar input–output databases with diferent classifcation schemes from the original input data source

EU enlargement and environmental policy

Die osteuropaeischen Beitrittskandidaten haben sich dazu verpflichtet, die Treibhausgasemissionen gemaess den im Kyoto-Protokoll festgelegten Zielen zu verringern. Ueberdies hat sich der Handel zwischen der EU und den osteuropaeischen Beitrittskandidaten seit 1993 liberalisiert. Es gibt inzwischen viel Literatur zu den oekonomischen Effekten der vollstaendigen Integration der Beitrittskandidaten, genauso wie auch zum Kyoto-Protokoll. Jedoch mangelt es an quantitativen Untersuchungen zur Verknuepfung von Handel und Umwelt im Kontext der EU-Erweiterung. In diesem Beitrag wird die Wechselwirkung von unterschiedlicher Umweltpolitik gemaess dem Kyoto-Protokoll und Handelsliberalisierung im Verlauf der EU-Osterweiterung mit Hilfe eines allgemeinen Gleichgewichtsmodells analysiert. Die Autoren vertreten die Ansicht, dass die Handelsliberalisierung einen grossen Gewinn fuer die osteuropaeischen Beitrittskandidaten darstellt, waehrend die EU-Mitgliedstaaten nur einen bescheidenen Gewinn aus der Liberalisierung ziehen. Die Integration zeigt keinen bedeutsamen Einfluss auf die Klimaschutzpolitik, mildert aber damit zusammenhaengende volkswirtschaftliche Kosten. (ICBUebers)'The Eastern European Associates (EEA) have committed to reduce greenhouse gas emissions according to their targets set in the Kyoto Protocol. Furthermore since 1993 trade liberalization has taken place between all associated countries and the EU. There is meanwhile a large quantitative literature on the economic effects of full integration of the associated countries into the EU as well as on the Kyoto Protocol. However, there is a lack of quantitative research on the linkage of trade and the environment in the context of the EU enlargement. In this paper we analyze the interactions of different environmental policies under the Kyoto Protocol and trade liberalization in the process of eastern enlargement using a computable general equilibrium model. The authors find that trade liberalization provides large gains for EEAs while it holds only modest gains for EU member states. Integration does not show a significant impact on carbon abatement policies, but mitigates associated welfare losses.' (author's abstract)German title: EU-Erweiterung und UmweltpolitikAvailable from ftp://ftp.zew.de/pub/zew-docs/dp/dp0152.pdf / FIZ - Fachinformationszzentrum Karlsruhe / TIB - Technische InformationsbibliothekSIGLEDEGerman