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Climate-conscious consumers and the buy, bank, burn program

Manipulation of European Union emission trading systems (ETS) by the buy, bank, burn program compensates unregulated emissions while regulated sectors carry a large part of the burden. This distorts the balance between regulated firms and non-regulated projects, so parties outside the EU ETS can be virtuous at the cost of others.

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Journal peer review information: Nature Climate Change thanks Grischa Perino and other anonymous reviewer(s) for their contribution to the peer review of this work.

References

  1. 1.

    The EU Emissions Trading System (EU ETS) (European Comission, 2016); https://ec.europa.eu/clima/sites/clima/files/factsheet_ets_en.pdf

  2. 2.

    Erbach, G. Post-2020 reform of the EU Emissions Trading System (European Parliamentary Research Service, 2017).

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    Gerlagh, R. & Heijmans, R. J. R. K. Regulating Stock Externalities CESifo Working Paper No. 7383 (CESifo, 2018).

  4. 4.

    Perino, G. Nat. Clim. Change 8, 262–264 (2018).

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Acknowledgements

The authors thank A. Callahan-Brandt for textual corrections. R.G. thanks the Research Council of Norway for financial support.

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Competing interests

Reyer Gerlagh is a member of the Advisory Council (RVA) of Carbonkiller, the Dutch allowance burning program.

Correspondence to Roweno J. R. K. Heijmans.

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