Publication type: Article in scientific journal
Type of review: Peer review (publication)
Title: The role of banks in EU emissions trading
Authors: Cludius, Johanna
Betz, Regina
et. al: No
DOI: 10.5547/01956574.41.2.jclu
Published in: The Energy Journal
Volume(Issue): 41
Issue: 2
Pages: 275
Pages to: 299
Issue Date: 2020
Publisher / Ed. Institution: IAEE
ISSN: 0195-6574
Language: English
Subjects: Banks; EU ETS; EUTL; Trading strategy
Subject (DDC): 332.1: Banks
Abstract: This paper is an empirical investigation of the role of banks in the EU Emissions Trading System (EU ETS). This topic is of particular interest considering that banks are responsible for a large and increasing share of overall transactions under the EU ETS and that they provide regulated companies with services related to emissions trading. Using both semi-structured interviews as well as descriptive and regression analysis, we investigated the different roles banks play in EU emissions trading and whether their importance as trading partners differs in relation to different types of regulated companies. Our regressions based on data from the first trading period of the EU ETS show that large companies with trading experience are more likely to choose a trading strategy involving interaction with a range of financial intermediaries, in particular banks or exchanges, than smaller, less professionalized companies, which tend to follow a trading strategy involving brokers (in particular for selling allowances). These findings can help policymakers decide on the level of involvement of non-regulated companies in their systems, which is currently allowed to varying degrees under different ETS. We recommend that this decision should be closely linked to provisions of market oversight and the level of control over the different types of financial players active in emissions trading.
Fulltext version: Published version
License (according to publishing contract): Licence according to publishing contract
Departement: School of Management and Law
Organisational Unit: Center for Energy and Environment (CEE)
Appears in collections:Publikationen School of Management and Law

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