Reports and briefings

The following reports and briefings have been produced thanks to the support of our core funders: The European Climate Foundation, the The Ecofin Foundation and the Esmee Fairbairn Foundation.

Bespoke analysis, reports and briefings on a range of topics can be commissioned - please contact us if you wish to discuss options.

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    August 2015

    There are strong environmental imperatives for reducing CO2 and the circular economy can play a critical role in delivering on emissions targets. At present, conventional fossil fuel energy plants along with many industrial facilities operate a linear process

    In many circles abating CO2 is seen as purely a liability and not yet as a business opportunity. As such, there is a growing risk that industry with high process emissions will either close or move out from under legally binding caps or stay and seek to undermine the meeting of emissions reductions targets and climate ambition more generally. Helping markets move away from BAU practices and adapt to low-carbon products will require that governments support circular business models and remove barriers that prevent low-carbon innovations being adopted in mainstream markets and products.

    August 2015
    Sandbag's recommendations on how to increase Europe’s economy-wide climate targets via the EU Emissions Trading Scheme (ETS).
    As pressure builds towards Paris it is imperative that Europe look for opportunities to increase its climate offer in the UN climate negotiations. The current review of the ETS Directive offers an important opportunity to activate the “at least” in Europe’s current pledge to reduce emissions by at least 40% from 1990 levels by 2030. This opportunity should not be overshadowed by debates about protecting EU industrial competitiveness.
    We outlay a series of proposals by which Europe could significantly step up its climate ambition at minimum cost. We have three main recommendations:
    • Adopt a 25% target in 2020 by cancelling allowances from the Market Stability Reserve
    • Adopt a 50% target in 2030 through a tighter ETS cap, state-level offsets and a safety-valve mechanism
    • Keep all unallocated allowances in the Market Stability Reserve

    Read the blog here.

    July 2015

    On Wednesday 15th July, the EU Commission released new legislation to reform Europe’s key climate policy, the EU Emissions Trading Scheme (EU ETS). This kicks off a year-long debate about how best to marry low carbon ambitions with economic competitiveness. In this briefing, Sandbag explains how the current rules are not sufficiently encouraging major industrial emitters to invest in decarbonisation, and shares its recommendations for reform. Sandbag also launches a new interactive data tool illustrating how many spare free emissions rights industry has built up over time, and forecasting future supply balances.

    June 2015

    To promote CCS and other methods of deep industrial decarbonisation, a combination of additional Member State and EU support will be needed, well beyond the proposed Modernisation and NER 400 funds. A supporting policy should be explored based on Contracts For Difference (CFD), similar to the UK's electricity CFDs, but pegged to the carbon price rather than the wholesale electricity price. This could fund any technology which permanently stored or abated CO2 emissions.

    June 2015

    Should we ditch the EU Emissions Trading Scheme or drop all other overlapping climate policies? 

    Neither, argues this new report, but we do need a better policy framework.

    The EU’s Emissions Trading Scheme is 10 years old this year. This report places it in the context of other climate and energy policies and explores the impact of external events that have occurred over the last decade.

    Webinar discussing the report at 11am BST

    On July 15th we are expecting a significant ETS reform package to be published, that will spark considerable debate about its future role and how it relates to other EU ambitions and policies.  This report is intended to inform that debate.

    June 2015

    Sandbag’s response to the European Commission Consultation on the preparation of a legislative proposal on the effort of Member States to reduce their greenhouse gas emissions to meet the European Union's greenhouse gas emission reduction commitment in a 2030 perspective. This consultation specifically focuses on the Effort Sharing Directive.

    May 2015

    This represent's Sandbag's submission to the Climate Change Committee's Call for Evidence regarding the 5th Carbon Budget. In light of new developments in the EU ETS, Sandbag leads with the recommendation that the UK budgets should shift to full territorial emissions accounting. This should replace the current system which "nets off" traded sector emisisons against estimated UK allocations in the EU ETS. We also urge the Committee to revise its global "climate objective" to reflect a likely chance of avoiding 2 degrees that is more consistent with the UK's international pledges. 

    May 2015

    With EUETS data now 99.9% complete, Sandbag has updated our analysis of emissions, including data on country and industry surplus.

    May 2015

    The deal struck by the Council in Coreper agreed a January 2019 start to the market stability reserve and the placement of both unallocated allowances and backloaded allowances into the MSR.

    In order to break the blocking minority on start date led by Poland, wealthier Member States had to agree to shield a volume of nearly 1.5 billion allowances that would benefit poorer ones. However, despite this substantial volume, the actual transfer of wealth between wealthier and poorer Member States could be as low as 14 million EUAs - although the actual figure may shoot up to 260 million EUAs depending on how the surplus actually develops.

    In this briefing, Sandbag provides a step by step overview of what allowance clusters are shielded, how the redistribution effects operate, and how gains and losses are distributed across groups of Member States.

    April 2015

    In this briefing Sandbag argues that Lithuania could reap advantages from supporting an enhanced Market Stability Reserve. We first argue why Lithuania should reconsider its position on the MSR. Then we present strong evidence based on ETS data, revealing the various ways in which the MSR would influence the competitiveness of Lithuania’s industry in the EU economy. We finally provide more detailed information about how the proposed ETS reform would function if implemented.

    See all our reports.