Energy commodities spillover analysis for assessing the functioning of the European Union Emissions Trading System trade network of carbon allowances.

ABSTRACT: The European Union Emissions Trading System (EU ETS) is designed to promote carbon reduction in a cost-effective and economically efficient manner. To meet their compliance requirements, participants within the EU ETS can either invest in carbon abatement, thereby improving their environmental performances, or purchase carbon allowances from the market. Our analysis aims to investigate the structural features of the EU ETS trade network of allowances and assess its robustness to spillovers propagated from energy commodities. We build the EU ETS trade network of allowances on a daily basis by leveraging a granular dataset comprising over 32k accounts that performed approximately 720k trades, involving more than 127 billion of allowances from 2005 to 2020. Importantly, our analysis is able t

SUBMITTER: Flori A 

PROVIDER: S-EPMC11408626 | biostudies-literature | 2024 Sep

REPOSITORIES: biostudies-literature