Currently, there is exactly one political mechanism for reducing carbon dioxide and other greenhouse gas emissions: emissions trading. First introduced in 2005 and the target of criticism ever since, it is nonetheless the EU’s crucial climate protection instrument and has made the EU the “role model” when it comes to a possible future global system.
Anyone can check online how many certificates a company has bought and used. But this information says nothing about how individual firms engage in emissions trading. To get to the bottom of the matter, the Hamburg-based researchers had to ask the companies themselves.
Miguel Rodriguez Lopez, Anita Engels and Lisa Knoll did precisely that for the pilot phase of European emissions trading from 2005 to 2007, investigating questions such as: Which department is responsible? When during the year are emissions permits bought or sold? Which technologies are used in order to reduce CO2 emissions? They then evaluated 1,270 questionnaires from Germany, Great Britain, Denmark and the Netherlands.
Sociological research uncovers gaps in emissions trading
Their main discovery: decisions about emissions trading are made differently, depending on whether the technical or financial departments are responsible. Engineers are more likely to try to optimize production to reduce CO2 emissions, whereas business managers tend to buy emissions permits in order to continue producing large amounts of carbon dioxide.
According to economic theory, the price and number of permits alone should be enough to reduce CO2 levels. But clearly there are other factors involved, for example, who makes the decision to purchase the permits.
The conclusion that Rodriguez Lopez and colleagues therefore arrived at: there should be more focus on those responsible for making these decisions – and the information on emissions trading needs to be presented differently to the different target groups. Business managers need to learn to include long-term investments climate protection measures in their short-term purchasing decisions. Further, it’s important to take these aspects into account with regard to other countries. For example, China has also decided to introduce an emissions trading system based on the European model, which will give them the opportunity to learn from Europe’s mistakes and to do it better right from the start.
- Original-Paper “Understanding carbon trading: Effects of delegating CO2 responsibility on organizations’ trading behavior” in the journal “Climate Policy”
- CliSAP Research Group Societal Use of Climate Information with Prof. Dr. Anita Engels, Dr. Juan Miguel Rodriguez Lopez and Dr. Lisa Knoll