New research sheds light on some of the unintended consequences of the EU\u2019s Emission Trading System (ETS) on European companies \u2013 notably in terms downsizing of workforces or reducing assets.<\/p>\n\n\n\n
The EU\u2019s Emissions Trading system was created in 2005 to force polluters to pay for their greenhouse gas (GHG) emissions. It is based on a \u201ccap and trade\u201d principle. The cap<\/a> refers to the limit set on the amount of GHG that can be emitted by companies in specified sectors including industrial manufacturing and electricity. Companies may also trade their allowances. If a company has spare emissions, they can either sell the spare allowances and\/or store them to use in the future.<\/p>\n\n\n\n