Acta academica karviniensia 2012, 12(4):183-192 | DOI: 10.25142/aak.2012.070

INTERACTION OF EU ETS ALLOWANCES AND ENERGY PRICES: EVIDENCE FROM THE CZECH REPUBLIC

Barbora Vondrušková¹, Ingeborg Němcová², Jiří Horák³

¹ Ing. Barbora Vondrušková, Asistentka a doktorandka Katedra světové ekonomiky, Fakulta mezinárodních vztahů, Vysoká škola ekonomická, Nám. W. Churchila 4, 130 67 Praha 3, Tel.: +420 224 09 5234, brvn@seznam.cz

² Doc. Ing. Ingeborg Němcová, CSc., Docentka Katedra světové ekonomiky, Fakulta mezinárodních vztahů, Vysoká škola ekonomická, Nám. W. Churchila 4, 130 67 Praha 3, Tel.: +420 224 09 5356, inge@vse.cz

³ Ing. Jiří Horák, MBA, Doktorand Katedra světové ekonomiky, Fakulta mezinárodních vztahů, Vysoká škola ekonomická, Nám. W. Churchila 4, 130 67 Praha 3, Tel.: +420 608 620 793, mr.jih@seznam.cz

This article follows closely one of the principal challenges of the European Union - global, economic and environmentally sustainable development. This development is currently endangered by climate change which is being caused by increasing concentration of greenhouse gases in the atmosphere. At this moment, market instruments (emissions allowances trading, carbon taxation, etc.) represent such a green house gases reduction policy, attributed with the lowest cost level and high transparency. First attempt on coordinated international effort within this domain was the Kyoto protocol valid until 2012 - currently there are intensive negotiations being hold at different levels about its successor. The European Union has projected its vision on post-Kyoto functioning into so called climate and energy package, adopted by the European Council in December 2008. Main part is being represented by revised EU ETS system, playing the role of the main instrument of greenhouse gases mitigation. Writers of this article aim to interpret this engagement and its impacts on energy prices in Czech Republic, respectively estimate expertly costs of that instrument and describe crucial economic consequences.

Keywords: EU ETS, climate and energy package, energy prices, coal prices, prices of emission allowances, climate change, structural cointegrated VAR model, Dickey-Fuller test, Hodrick-Prescott filter

JEL classification: O13, Q53, Q54, R15

Published: December 30, 2012  Show citation