Issues behind Competitiveness and Carbon Leakage
This report explores the vulnerability of heavy industry to carbon leakage and competitiveness loss. It reviews the existing literature on competitiveness and carbon leakage under uneven climate policies. It also suggests a statistical method to track carbon leakage, and applies this methodology to Phase I of the EU emissions trading scheme, for various industrial activities: iron and steel, cement, aluminium and refineries.
Finally, it reviews measures to mitigate carbon leakage, as discussed in Australia, Canada, Europe, New Zealand and the US.