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How does the EU-ETS work? 8
How was it created? 8
Allocation of caps and allowances 8
Price establishment 8
Types of trading allowed 9
Penalty 9
5. Is CET helping? 10
CET Today. 10
Is CET reaching the Kyoto Agreement? 11
References 12
Appendix A - Member states and Emission caps 13
Appendix B - Countries that are listed in the UNFCCC 13
Annex I countries (industrialized countries): 13
Annex II countries (developed countries which pay for costs of developing countries): 14
Annex B countries 14
Appendix C - EU-ETS price trading history 15
1. Why free markets are efficient?
What are free markets?
In economic terms, "free market" is defined as "an economy where all economic decisions are taken by individual households and firms and with no governmental intervention" (Sloman, 2000)...
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