Reducing industrial greenhouse gas emissions is essential to fight climate change. In addition, private consumption patterns have effects on emissions and the sustainable use of natural resources. This thesis examines the effect of certain environmental policies on Swedish industries and its greenhouse gas emissions, and also analyses household consumption patterns of environmental goods.
The EU emission trading system (ETS) is a market-based instrument to reduce greenhouse gas emissions. Its effectiveness is under constant scrutiny, in particular since regulatory changes of the third phase are expected to have larger impacts on carbon emissions. An empirical study is conducted to evaluate the effect of the different phases of the EU emission trading system on firms’ carbon emissions and, on their low-carbon innovation activity. Results indicate that low-carbon patenting and environmental and air-related investments in firms regulated by the emission trading system have increased over time, but emissions did not decrease. Swedish firms regulated by the ETS showed better economic indicators during the first phase.
When the ETS was introduced, Sweden already had in place an energy policy with the goal to increase renewable energy capacities. It is analysed whether the combination of these two systems results in counterproductive price signals. The results suggest that this is not the case.
Sustainable consumption patterns must complement sustainable production. Therefore, the thesis also studies the relation of households’ green consumption and behaviour patterns, and finds that households’ willingness to pay for environmental goods in different domains tend to be complements whereas behaviours tend to be substitutes
