REVENUES ACCRUED IN PHASE III OF THE EU ETS

The document estimates that Phase III of the EU ETS will generate between €150-190bn in revenues across the EU by 2020, potentially rising to €200-310bn if a 30% reduction target is adopted. Germany is projected to receive the highest proportion of these revenues, while Italy, Poland, Spain, and the UK are each expected to accrue over €10bn from the power sector alone. The briefing also explores the financial impact of expanding auctioning to the cement and steel sectors and suggests strategic uses for these funds, including carbon capture and storage (CCS) demonstration, renewable energy RD&D, grid infrastructure, and international climate finance.

• Under the current proposed allocation structure, the EU ETS is expected to raise between €150-190bn across the EU by 2020, which could increase to €200-310bn if the EU adopts a 30% target with a 34% cap relative to 2005.
• Germany is projected to receive the largest share of auction revenues, estimated at €37-46bn under a 20% target, even after a 12% redistribution of revenue to Member States with lower GDP and those exceeding Kyoto commitments.
• Four specific countries—Italy, Poland, Spain, and the UK—are each projected to generate more than €10bn in auction revenue specifically from the power sector.
• Implementing full auctioning for the cement sector (combined with border levelling) would generate €20-25bn across the EU under a 20% target, increasing to €26-€40bn under a 30% target, with €7.5–15bn accruing to Portugal, Spain, Italy, Greece, and Ireland.
• Full auctioning of the steel sector would generate between €13-25bn under a 20% target and €17-41bn under a 30% target, though the additional revenue gain over current benchmarked free allocation would be lower than in cement.
• The document proposes several strategic uses for ETS revenues to support the low carbon transition, including funding carbon capture and storage (CCS) technology, doubling low carbon energy RD&D toward a €50bn goal, and strengthening EIB loans for renewables and grid infrastructure.
• Auction revenues are identified as a potential source for meeting international climate commitments, such as the Copenhagen-Cancun agreements' goal of increasing 'fast start' financing to €21bn/yr (2010-2012) and eventually €100bn/yr collectively from industrialised countries.

APA

Cooper, S., Grubb, M., & Fazekas, D. (2011). REVENUES ACCRUED IN PHASE III OF THE EU ETS. Climate Strategies. https://climatestrategies.org/wp-content/uploads/2014/11/cs-auction-revenue-brief-11may.pdf

Chicago

Cooper, Simone, Michael Grubb, and Dora Fazekas. REVENUES ACCRUED IN PHASE III OF THE EU ETS. Climate Strategies, 2011. https://climatestrategies.org/wp-content/uploads/2014/11/cs-auction-revenue-brief-11may.pdf.

Wikipedia

{{cite report |last1=Cooper |first1=Simone |last2=Grubb |first2=Michael |last3=Fazekas |first3=Dora |title=REVENUES ACCRUED IN PHASE III OF THE EU ETS |publisher=Climate Strategies |date=11 May 2011 |url=https://climatestrategies.org/wp-content/uploads/2014/11/cs-auction-revenue-brief-11may.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{cooper2011revenues, author = {Cooper, Simone and Grubb, Michael and Fazekas, Dora}, title = {{REVENUES ACCRUED IN PHASE III OF THE EU ETS}}, institution = {Climate Strategies}, year = {2011}, month = may, url = {https://climatestrategies.org/wp-content/uploads/2014/11/cs-auction-revenue-brief-11may.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }