EFET sees markets as being at the very core of decarbonisation policy. We see well-functioning, competitive markets in:
- Carbon emission allowances;
- In energy commodities; and
- In sustainability attributes
As each playing an important, and distinct, role in driving Europe’s energy transition.
Each of these markets will play a role in signalling the value of particular technologies. However, we recognise that the signals sent by these markets will, on occasion, need to be complemented by additional policy measures. Where this is the case, we recommend:
- Focussing on compatibility and complementarity – ensuring that policy measures don’t dampen the signals sent by markets;
- Using competitive allocation – to drive down costs and maximise innovation;
- Aligning design - using common principles to minimise the number of different policy measures and applying policies, in due course, across broad geographic areas.