The calculation estimates that for instance Greece could see its budget increasing from 150 million euros to 2.7 billion euros - enough to avert having to take on new debt. Spain stands to gain 6.2 billion euros and Italy 6.9 billion. For the European Union as a whole, the current revenues of 3.55 billion could rise to about 64 billion euros. “Especially in southern Europe, several states are so deeply in debt that their finance ministers would do well to put a higher price tag on carbon instead of taking the familiar route of taxing labor or capital,” says Edenhofer. “Eventually, this could also improve the international competitiveness of these countries. This applies especially to countries that are having difficulties to actually collect nominal taxes on labor and capital due to sizeable informal sectors in their economies.”
Such a reform of the EU ETS would need to include the following three main changes: One, the minimum price for an allowance should not go below 20 euros per tonne. Two, emissions trading would have to be expanded within the transport and building sectors. And three, the volume of free allocations of allowances would have to be considerably reduced. As a result, about 80 percent of allowances could likely be auctioned, instead of the current 40 percent.
Weblink to MCC: http://www.mcc-berlin.net/en/topnews/reform-of-eu-ets.html
