Climate Policy Department Publications

Utilisation of Reactive Ionic Liquids for Energy Storage and Regulation of the Power Grid

Chlorine is an essential feedstock for polymers and pharmaceuticals, with annual production exceeding 100 Mt. Nearly all Cl2 is obtained by chlor–alkali electrolysis, which consumes about 2.58 MWh of electricity per tonne. Renewable energies such as wind and solar would lower CO2 emissions, but electrolysers would then have to adopt to fluctuating, renewable energies while downstream processes still ...

Contracting Matters: Hedging Producers and Consumers with a Renewable Energy Pool

Renewable energy installations are rapidly gaining market share due to falling technology costs and supportive policies. Meanwhile, the energy price crisis in 2022 shifted the energy policy debate toward the question of how consumers can better benefit from the low and stable generation costs of renewable electricity. Long-term contracts for renewable energy to link producers and consumers are an option ...

Taxonomy Disclosure in the EU: A Useful Framework, Despite Current Challenges

The EU Taxonomy is a classification system for sustainable economic activities and a framework for various regulatory initiatives. Its primary objectives are to enhance transparency, to reduce greenwashing and ultimately to redirect capital toward more sustainable activities. However, since its introduction, market participants have raised concerns about whether the benefits justify the costs. This ...

Collaborative Investor Engagement with Policymakers: Changing the Rules of the Game?

Purpose – Applying universal ownership theory and drawing on a multiplecase study design, this study aims to analyze what drives institutional investors to engage with government entities and what challengesthey find in the process.Design/methodology/approach – The authors relied on document analysis and conducted 12 semistructured interviews with representatives from asset owners, assetmanagers, investor ...

EU Power Market Reform Toward Locational Pricing: Rewarding Flexible Consumers for Resolving Transmission Constraints

The ongoing expansion of wind and solar electricity generation alongside increasing electrification is leading to a considerable strain on transmission capacities and grid bottlenecks in the EU. Coping with this challenge requires increasing system flexibility, e.g. by exploiting the potential for demand-side flexibility. However, in the current market design, demand-side flexibility responds to zonal ...

Nobody Decides for All — Modeling Incentives and Policies for Closing the Material Loop

Catalyzing the Transition to a Climate-Neutral Industry with Carbon Contracts for Difference: Commentary

Renewable Energy and Equilibrium Hedging in Electricity Forward Markets

We study the impact of renewable energy on forward markets for electricity. Previous literature shows that forward prices are determined by time-varying demand and volatile spot prices. We introduce supply risk from renewable generation and find that stochastic renewable output mitigates income risk for generating firms, in particular when negative shocks to renewable output have large positive price ...

The EU Sustainable Finance Taxonomy and Its Contribution to Climate Neutrality

The EU Taxonomy is the first standardised and comprehensive classification system for sustainable economic activities. It covers activities responsible for up to 80% of EU greenhouse gas emissions and may play an important role in channelling investments into low-carbon technologies by helping investors to make informed decisions. However, especially in transition sectors much depends on the stringency ...

Assessing the Social and Environmental Impacts of Critical Mineral Supply Chains for the Energy Transition in Europe

Advanced technologies are inherently dependent on critical minerals and their related metals. The mining extraction of these critical minerals leads to significant social and environmental impacts that extend beyond the regions where those advanced technologies are ultimately used. This study explores the global socio-environmental challenges arising from the European Climate Law's aim for net-zero ...