“When we emit greenhouse gases we damage the prospects for others and, unless appropriate policy is in place, we do not bear the costs of the damage. Markets then fail in the sense that their main co-ordinating mechanism – prices – give the wrong signals.” Professor Nick Stern (Blueprint for a cleaner planet)

Carbon trading is an important part of the EU’s environmental targets – the challenge is to find policies that are EFFECTIVE, EFFICIENT and EQUITABLE.

This four page revision note provides some analysis and evaluation on the European Union emissions trading system - designed for AQA A2 economists but hopefully also useful for those preparing for the 2888 paper and for students preparing environmental questions for the Edexcel Board.

Revision on Carbon Trading:

http://www.tutor2u.net/blog/files/EU_Revision_Carbon_Trading.pdf