Authors

Mark C. Lewis and Isabelle Curien

Research organisation

Deutsche Bank

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Hard to Credit: ETS Offset Use Again in the Spotlight

Report Date

June 2010

Release Date

July 2010

Document summary

The European Commission argues that achieving a 30% emissions-reduction target by 2020 will now be cheaper and is considering restricting usage of certain CERs in the ETS beyond 2012. Deutsche Bank views these restrictions as possibly counterproductive if applied within the strict letter of the law. While it would be easier now to achieve this target forecasts indicate ETS abatement will be required under both the 20% and 30% emissions-reduction target even after full use of the allowed offset quota in each case. Ensuring a secure supply of offsets to the ETS over 2013-20 is crucial to minimising compliance costs.