The experience of the EU’s 2020 Climate and Energy Package has raised a number of basic questions about the role of different policy instruments for power market decarbonisation. These include: the capacity of the carbon market to drive low-carbon investment, what form renewable and low-carbon investment supports should take, the speed of retirement of existing carbon-intensive capacity, how to manage interactions between the ETS and complementary policies.
This paper - which is co-authored by IDDRI, Oeko Institute in Germany and CSIC in Spain, together with Climate Strategies, draws lessons from the experience of the 2020 Climate and Energy Package and provides recommendations of for the design of the EU's 2030 Climate and Energy Package.
