Carbon leakage myth buster

The document reports that Swedish energy-intensive industries generated approximately €729 million in windfall profits from the EU ETS between 2008 and 2014. These profits were driven by the surplus of free emission allowances, the use of low-cost international offsets, and cost-pass through to customers. The brief highlights that the Swedish government missed out on at least €1.9 billion in auctioning revenues due to these free allocations. It specifically identifies SSAB, Preem, and Cementa as the highest profiting corporations. The author argues that the risk of carbon leakage is unsubstantiated and that the current system reduces incentives for industrial decarbonization, recommending a phase-out of free allocations in favor of full auctioning.

• Energy-intensive industries in Sweden generated approximately €729 million in windfall profits from the EU ETS between 2008 and 2014. These profits were derived from three sources: €388 million from selling surplus emission allowances, €15 million from using cheaper international offsets, and €326 million from cost-pass through to customers.
• Specific Swedish corporations significantly profited from the EU ETS, with SSAB earning €345 million, Preem earning over €87 million, and Cementa earning approximately €54 million. SSAB's profits included €189 million from selling excess free allowances, having received 39 million free allowances against verified emissions of 22 million tonnes CO2-eq.
• The Swedish government lost at least €1.9 billion in potential auctioning revenues between 2008 and 2014 because 109 million (or 173 million according to the executive summary) pollution permits were given away for free to industry.
• The document argues that the 'carbon leakage' justification is unsubstantiated and that the Paris agreement will mitigate these risks after 2020 by creating a more level global playing field.

APA

Carbon Market Watch (2016). Carbon leakage myth buster. https://carbonmarketwatch.org/wp-content/uploads/2016/03/Carbon-leakage-myth-buster-Sweden_WEB.pdf

Chicago

Carbon Market Watch. Carbon leakage myth buster. 2016. https://carbonmarketwatch.org/wp-content/uploads/2016/03/Carbon-leakage-myth-buster-Sweden_WEB.pdf.

Wikipedia

{{cite report |author=Carbon Market Watch |title=Carbon leakage myth buster |date=March 2016 |url=https://carbonmarketwatch.org/wp-content/uploads/2016/03/Carbon-leakage-myth-buster-Sweden_WEB.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{carbonmarketwatch2016carbon, author = {{Carbon Market Watch}}, title = {{Carbon leakage myth buster}}, institution = {Carbon Market Watch}, year = {2016}, month = mar, url = {https://carbonmarketwatch.org/wp-content/uploads/2016/03/Carbon-leakage-myth-buster-Sweden_WEB.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }