Retrospective on Phase 1 of the European Union Emissions Trading Scheme (EU-ETS) - Lessons Learnt.

The EU ETS has already caused emissions reduction through internal abatement despite somewhat over-allocating allowances in Phase 1, which has just concluded. There has been much reflection on the lessons learned this initial phase. The focus of this paper is to summarize a cross section of those discussions, representing the perspectives of policy makers, economists, traders, business executives, and environmentalists. Where there is consensus, to identify it. Where there are competing perspectives, to present them fairly. It should be noted however, that virtually every lessons-learned discussion has been presented by proponents of market-based solutions for emissions control, in the hope that they will help the carbon market to more successfully evolve. Sources are listed at the end and referenced parenthetically throughout. This white paper has been written by Don Sunderland V.P. Open Source Solutions, Misys plc.