CEU eTD Collection (2024); Röhrl, Sophie Alisa Theresa: What stands in the way becomes the way - Drawing lessons from the EU ETS for overcoming barriers to an ETS for agricultural GHG emissions in Europe through feasible policy sequencing

CEU Electronic Theses and Dissertations, 2024
Author Röhrl, Sophie Alisa Theresa
Title What stands in the way becomes the way - Drawing lessons from the EU ETS for overcoming barriers to an ETS for agricultural GHG emissions in Europe through feasible policy sequencing
Summary Agricultural emissions account for about 13.2% of total greenhouse gas (GHG) emissions in the EU. However, existing command-and-control measures, such as the Land Use, Land Use Change, and Forestry (LULUCF) Regulation, and the Common Agricultural Policy (CAP) have been largely ineffective in reducing agricultural GHG emissions. Market-based instruments, such as an Emission Trading System (ETS), could be pivotal to realizing the full mitigation potential of agriculture as suggested by its effectiveness in sectors currently covered under the EU ETS. However, so far this potential is untapped, and multiple barriers such as transaction costs, leakage risks, and distributional impacts hinder an implementation. Yet, the magnitude of these barriers critically depends on policy design. The introduction of the EU ETS in other sectors suggests that policy sequencing as a result of internal policy feedback, cross-policy feedback, and external effects could be pivotal to overcoming these barriers over time. This study aims to explore feasible pathways to gradually phase-in an ETS for the agricultural sector in the EU by learning from the existing EU ETS in other sectors and accounting for the unique features of agriculture. It utilizes desk research, 18 semi-structured interviews, and a stakeholder workshop with experts and key stakeholders along the agricultural value chain. The policy sequencing framework based on Leipprand et al. 2020 guides this analysis. Learning from the policy evolution of the EU ETS, this research suggests that a gradual phase-in of an EU ETS for agricultural emissions through policy sequencing, could reflect the heterogeneity of actors and emissions sources and be conducive to reducing economic, political, and administrative barriers over time. An initial high share of allowances allocated via grandfathering and a focus on emission sources with high mitigation potential but low transaction costs (i.e. N2O and CH4 from animal husbandry) focusing on large farms or up-and down-stream actors could lead to learning and constituency-building effects facilitating ratcheting-up of policy stringency. Moreover, the use of price management tools and strategic compensation measures is crucial for uptake. Alignment with other instruments, such as the CAP as well as political leadership and societal momentum could also be conducive. Finally, this approach emphasizes the importance of early action, a clear long-term roadmap, and strong policy signals to achieve substantial climate mitigation in the agricultural sector in the long run.
Supervisor Cherp, Aleh
Department Environment Sciences and Policy MSc
Full texthttps://www.etd.ceu.edu/2024/rohrl_sophie.pdf

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