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Article
Publication date: 14 October 2013

Jacob Hörisch

This paper aims to identify under which circumstances company internal emission trading schemes (IETS) are applied and to examine their actual effects on corporate

Abstract

Purpose

This paper aims to identify under which circumstances company internal emission trading schemes (IETS) are applied and to examine their actual effects on corporate greenhouse-gas (GHG) emissions.

Design/methodology/approach

Using contingency theory, factors are identified that influence corporate decisions to introduce an IETS. To examine the effects of IETSs, emissions data for a sample of large German companies is used for linear regression modelling.

Findings

The paper finds that today, IETSs are mainly applied by companies with high levels of emissions that are subject to external trading schemes. The current use of IETSs seems to be primarily driven by the interest to reduce emissions cost-efficiently. Testing the effects of IETSs reveals that they are able to reduce corporate GHG emissions significantly.

Research limitations/implications

The effects of IETSs are only tested for companies subject to an external emission trading scheme. Furthermore, the analysis does not distinguish between different types of IETSs. Future research should address the issue of whether the reductions observed also hold true for companies not subject to external trading schemes and should formulate recommendations on how IETSs should be designed.

Practical implications

The paper informs practitioners about the potential benefits of IETSs.

Originality/value

For the first time, the effects of IETSs are tested for companies subject to an external emission trading scheme. The analysis suggests that a new academic debate on IETSs is needed as the introduction of external emission trading schemes has not rendered IETSs redundant.

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Article
Publication date: 5 October 2020

Neng Shen, Yuqing Zhao and Rumeng Deng

This paper aims to review the literature on carbon trading from the perspective of evolution, finds out the evolution path of these literatures and gives out the future…

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1405

Abstract

Purpose

This paper aims to review the literature on carbon trading from the perspective of evolution, finds out the evolution path of these literatures and gives out the future research hotspots in this field.

Design/methodology/approach

Uses visualization tools (CiteSpace and HistCite) to systematically categorize the literature on carbon-trading schemes in the Web of Science core collection from 1998 to 2018, comprehensively analyzes carbon-trading schemes from four dimensions, namely, discipline evolution, keyword evolution, citation cluster evolution and citation path evolution.

Findings

Research on carbon-trading schemes has a specific development and evolution path along four dimensions, namely, in the discipline dimension, the largest change lies in the mathematics pointed to by at least four different disciplines; the keyword evolution dimension shows a gradual deepening emphasis on coordinated development; citation clusters identify three major clusters – carbon prices, China’s carbon trading, carbon market and supply chain; and citation paths identify three major evolutionary paths, the most important of which shows that “What affects carbon price?” has changed to “What is the impact of carbon prices?”

Originality/value

Reveals the evolution path of carbon trading research studies and proposes four possible development directions for carbon-trading scheme research, which is helpful for future carbon trading-related research and serves as a reference for the promotion of and improvements in carbon-trading schemes.

Details

International Journal of Climate Change Strategies and Management, vol. 12 no. 5
Type: Research Article
ISSN: 1756-8692

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Book part
Publication date: 6 August 2014

Janina D. Scheelhaase

This chapter provides an overview of the current political regulations on aviation’s climate relevant emissions in Europe, Australia, and New Zealand and of the planned…

Abstract

This chapter provides an overview of the current political regulations on aviation’s climate relevant emissions in Europe, Australia, and New Zealand and of the planned regulations in other parts of the world. In a next step, the cost impacts of most of these regulations on air freight will be quantified. This way, the economic impacts of environmental regulations on air freight can be estimated.

The main results indicate that cost impacts on air freight services induced by political measures for the reduction of aviation’s climate relevant emissions turn out to be small. This is true for both local emission charges on nitrous oxide (NO X ) and hydrocarbon (HC) emissions which are in force at a number of European airports and the European emissions trading scheme for the limitation of CO2 emissions.

Details

The Economics of International Airline Transport
Type: Book
ISBN: 978-1-78350-639-2

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Article
Publication date: 28 April 2014

Patrick T.I. Lam, Edwin H.W. Chan, Ann T.W. Yu, Wynn C.N. Cam and Jack S. Yu

This paper aims to investigate how unique features of built facilities would affect the application of greenhouse gas (GHG) emissions trading, and to explore what adaptive…

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1083

Abstract

Purpose

This paper aims to investigate how unique features of built facilities would affect the application of greenhouse gas (GHG) emissions trading, and to explore what adaptive measures may be taken for emissions trading to be applied to the built environment. Emissions trading is a financial tool to encourage GHG emissions reduction in various industries. As the building sector is responsible for a large amount of GHG emissions, it is valuable to explore the application of emissions trading in built facilities.

Design/methodology/approach

The analysis is based on a comparative study reviewing the current emissions trading schemes (ETSs) in Australia, Japan and the UK covering the building industry, and to evaluate the approaches adopted by the schemes to tackle the problems related to buildings and facilities management.

Findings

The research findings reveal that the small energy savings of individual building units, the large variety of energy-saving technologies and the split incentives and diverse interests of building owners and tenants would be the barriers hindering the development of emissions trading. To overcome these barriers, an ETS should allow its participants to group individual energy savings, lower the complexity of monitoring and reporting approaches and allow owners and tenants to benefit from emissions trading.

Originality/value

This article provides a comprehensive overview of the current emissions trading practices in the built environment. Besides, it raises the attention and consciousness of policymakers to the need that building characteristics and facilities management should be taken into consideration when designing an ETS for the building sector.

Details

Facilities, vol. 32 no. 7/8
Type: Research Article
ISSN: 0263-2772

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Article
Publication date: 7 October 2013

Clifford Curtis Williams

This article purports to show that an adequate anti-money laundering (AML) regime must be integrated into the carbon emissions market industry in order for it to function…

Abstract

Purpose

This article purports to show that an adequate anti-money laundering (AML) regime must be integrated into the carbon emissions market industry in order for it to function effectively, meet its intended goals, and prevent criminals from developing innovative methods to take advantage of particular vulnerabilities this unique market type has created.

Design/methodology/approach

This article discusses the formation of the international carbon emissions marketplace. It posits that critical to the formation and effective operation of any carbon emissions trading market is the simultaneous coexistence of an AML regime preventing criminals from taking advantage of legislative deficiencies. Lastly, the article formulates and analyzes emerging criminal typology threats to which current, developing, and future carbon emissions markets are and will be subject.

Findings

Under the EU ETS, effective AML safeguards were not initially included in the implementation and formation of the EU's carbon emissions trading market, subjecting it to numerous threats and abuses from criminals. The lack of an effective AML regime has resulted in novel and unique criminal typology threats that are currently emerging and need to be addressed to prevent abuses in new and existing carbon emissions trading markets.

Research limitations/implications

The EU has recently started addressing its lack of effective AML safeguards in its carbon emissions trading market. As such, the adequacy of legislative developments needs to be examined over time. Additionally, because many of the emerging criminal typologies identified are based on recent and limited data, further research on the extent of criminality that is actually occurring is recommended.

Originality/value

Because emerging criminal typology threats in carbon emissions trading markets has not been researched at the scholarly level, this article is unique and has substantial value to the AML community.

Details

Journal of Money Laundering Control, vol. 16 no. 4
Type: Research Article
ISSN: 1368-5201

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Article
Publication date: 10 April 2009

Qin Wang, Hui Gao, Fushuan Wen, Iain MacGill and Jiansheng Huang

The purpose of this paper is to overview the development of China's emission trading, which is transforming environmental policy measures from traditional command and…

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1156

Abstract

Purpose

The purpose of this paper is to overview the development of China's emission trading, which is transforming environmental policy measures from traditional command and control regulations to business‐led decision making within government initiated environmental markets, and investigates the main factors that affect China's policy making with regards to further climate changes.

Design/methodology/approach

This paper is based on the authors' review of the literatures on emissions trading program in China and their critical analysis.

Findings

Initially China's environmental protection policies were focused principally upon the reduction of sulfur dioxide (SO2) emissions for improving air quality. Since the authorization of the Kyoto Protocol in 2002, project‐based activities such as Clean Development Mechanism producing carbon credit developed rapidly. However, the implementation of carbon dioxide emission trading is still under discussion and research is much inferior to that of SO2 emission trading. The barriers of and suggestions for designing future emissions trading market are also discussed.

Originality/value

This review helps to raise awareness and understand possible scenarios for emission trading in China.

Details

International Journal of Energy Sector Management, vol. 3 no. 1
Type: Research Article
ISSN: 1750-6220

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Article
Publication date: 15 July 2019

Murad Harasheh and Andrea Amaduzzi

This paper aims to investigate the value relevance of the European Emission Allowance (EUA) return and volatility on the equity value of the top listed European Power…

Abstract

Purpose

This paper aims to investigate the value relevance of the European Emission Allowance (EUA) return and volatility on the equity value of the top listed European Power Generation Firms for the three trading phases of the European Emission Trading Scheme.

Design/methodology/approach

The authors use the multifactor financial market model over the period 2005-2016 on daily basis for the return relevance relationship, whereas time series models such as autoregression moving average and generalized autoregressive conditional heteroskedasticity are applied on a weighted average portfolio of the sample firms to test serial correlation and volatility of returns.

Findings

The findings are novel in which a positive and significant relevance of EUA return on equity return is shown; however, a vanishing effect is seen as one moves to further trading phases. Another remarkable finding is that the return relationship remains constant until a certain level in EUA price then inverts. Finally, the authors present that EUA is considered a systematic factor as firm and country-specific features are not statistically significant.

Practical implications

At policy level, these findings signal policymakers for an appropriate design of the future trading phases in which they achieve the balance between public interests, as climate risk mitigation by reducing emissions, and the private interests of the market players to support innovative changes.

Originality/value

To the authors’ knowledge, this study would be the first to offer recent and comprehensive findings on the economic and financial implications of the European Emission Trading Scheme for the three trading phases. Additionally, the research offers time series robustness check besides the standard regression analysis and shows that there is an optimal EUA price that triggers polluters’ decision on emission and generation.

Details

Studies in Economics and Finance, vol. 36 no. 3
Type: Research Article
ISSN: 1086-7376

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Book part
Publication date: 14 December 2016

Osamuyimen Enabulele, Mahdi Zahraa and Franklin N. Ngwu

This chapter examines the UK and the Nigerian approach to reducing emission of greenhouse gases (GHGs) into the environment as a result of gas flaring utilising the…

Abstract

Purpose

This chapter examines the UK and the Nigerian approach to reducing emission of greenhouse gases (GHGs) into the environment as a result of gas flaring utilising the market-based regulation. Determining how different jurisdictions fare in the quest to reduce GHG emissions associated with the oil and gas industry is essential because: policy makers have realised the advantages of market-based regulation over the command-and-control regulation; and in the light of various pledges different countries have made in different forum to reduce the emission of GHGs, particularly in the wake of the recently held Paris climate change conference.

Design/methodology/approach

Library-based approach is used, providing conceptual and theoretical understanding of climate change, GHG emissions and various market-based regulatory tools utilised in the United Kingdom and Nigeria in regulating emission associated with operations in the oil and gas industry.

Findings

The study reveals the significance of environmental regulations that encourage region integration and flexibility in the implementation of environmental policies. Moreover, it finds that the Paris Agreement re-affirms the utilisation of market-based regulations and indicates a future for investment in the oil and gas industry.

Practical implications

The study revealed that there are lacunas in regulations and strategies for the implementation of environmental regulations which need to be addressed in order to achieve zero or a significant decrease in gas flaring.

Originality/value

This study provided an ample opportunity to theoretically examine market-based regulatory tools utilised in the oil and gas industry in a developed country in relation to a developing country.

Details

Climate Change and the 2030 Corporate Agenda for Sustainable Development
Type: Book
ISBN: 978-1-78635-819-6

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Article
Publication date: 25 October 2011

Patty McNicholas and Carolyn Windsor

This paper aims to carry out a critical analysis of the proposed Australian emissions trading scheme (ETS) as a complex market solution to reduce greenhouse gases (GHGs)…

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7292

Abstract

Purpose

This paper aims to carry out a critical analysis of the proposed Australian emissions trading scheme (ETS) as a complex market solution to reduce greenhouse gases (GHGs). Specifically it seeks to examine the financial regulatory infrastructure that will more than likely oversee the Australian ETS, the same regulatory infrastructure which failed to prevent the global financial crisis.

Design/methodology/approach

A critical examination of the financialisation of the atmosphere that follows the growth of the financialisation of capitalism when economic activity shifted from production and service sectors to finance. Financialisation of capitalism is supported by capitalist regulation influenced by neo‐liberal doctrines of free markets and small government.

Findings

Trillions of dollars of taxpayer funds bailed out large financial institutions that nearly collapsed after unregulated trading in complex financial products that were supposed to hedge future risk. Corporate emissions trading will involve similar financial products. The measurement and reporting of actual emissions to support the Australian ETS also creates challenges for the accountancy profession to provide a workable conceptual framework.

Practical implications

If the currently flawed financial infrastructure required for the GHG emissions trading scheme, no amount of taxpayer funded bailouts will reverse the extreme climate change associated with an environmental catastrophe.

Originality/value

The application of financialisation of monopoly capitalism and capitalist regulation theories to the critical analysis of commoditised GHGs traded as financial products in the proposed Australian ETS.

Details

Accounting, Auditing & Accountability Journal, vol. 24 no. 8
Type: Research Article
ISSN: 0951-3574

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Article
Publication date: 8 August 2016

Ke Wang, Yujiao Xian, Jieming Zhang, Yi Li and Linan Che

This study aims to provide an estimation of carbon dioxide (CO2) emission abatement costs in China’s industry sector during the period of 2006-2010, and additionally…

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1246

Abstract

Purpose

This study aims to provide an estimation of carbon dioxide (CO2) emission abatement costs in China’s industry sector during the period of 2006-2010, and additionally provide an ex-post estimation of CO2 abatement cost savings that would be realized if carbon emission permits trading among different industry sectors of 30 provinces in China during the same period were allowed, to answer the question that whether the industrial carbon emission abatement cost can (partially) be recovered from carbon emission trading in China.

Design/methodology/approach

The joint production framework associated with the environmental technology is utilized for formulating the models for estimating abatement costs and simulating emission permits trading scheme. Several data envelopment analysis-based models that could deal with both the desirable and undesirable outputs within the above framework are utilized for abatement cost saving estimation. The weak disposability assumption and variable returns to scale assumption are applied in the modelling.

Findings

In China’s industry sector, during 2006-2010, the estimated CO2 emission abatement cost was 1,842 billion yuan, which accounts for 2.45 per cent of China’s total industrial output value; the emission abatement cost saving from emission permits trading would be 315 billion yuan, which accounts for 17.12 per cent of the emission opportunity abatement cost; and additional 1,065.95 million tonnes of CO2 emission reductions would be realized from emission permits trading, and this accounts for 4.75 per cent of the total industrial CO2 emissions.

Research limitations/implications

The estimation is implemented at the regional level, i.e. the emission permits trading subjects are the whole industry sectors in different Chinese provinces, because of the data limitation in this study. Further estimation could be implemented at the enterprise level to provide a deeper insight into the abatement cost recovery from emission permits trading.

Practical implications

The estimation models and calculation process introduced in this study could be applied for evaluating the efficiency and effectiveness of pollutant emission permits trading schemes from the perspective that whether these market-based abatement policy instruments help to realize the potential abatement cost savings.

Originality/value

To the best of the authors’ knowledge, no study has provided the estimation of CO2 emission abatement cost and the estimation of CO2 abatement cost saving effect from emission permits trading for China’s industry sector. This study provides the first attempt to fill this research gap.

Details

Journal of Modelling in Management, vol. 11 no. 3
Type: Research Article
ISSN: 1746-5664

Keywords

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