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Scientific analyses on the introduction, design, and scaling of Carbon Contracts for Difference (CCfD) for the decarbonization of basic industries

Current Project

Department

Climate Policy

Project Management

Karsten Neuhoff

Project Period

August 1, 2021 - July 31, 2024

Commissioned by

Fraunhofer-Institut für System- und Innovationsforschung (Fraunhofer ISI), (via einer Förderung des Bundesministerium für Wirtschaft und Klimaschutz (BMWK))

In Cooperation With

Institut für Ressourceneffizienz und Energiestrategien GmbH (IREES), Potsdam Institut für Klimafolgenforschung (PIK), Öko-Institut e.V., Prof. Dr. Stefan Klinski

Overview

The project relates to the current political discussion on the decarbonization of industry. The focus is on project-based Carbon Contracts for Difference (CCfD) for industry. An important focus is on the design and monitoring of a national support scheme. The research results of the project are incorporated into the development of the program as required and as targeted as possible. Specifically, the project team is analyzing selected relevant industries or production processes in detail, especially with regard to their cost structure and thus expected abatement costs. The team also considers Carbon Contracts for Difference as a new policy instrument in their interplay with other policies or support instruments for emissions-intensive industry, the EU Emission Trading System and Carbon Border Adjustment Mechanism, and possible new instruments such as demand quotas. It also considers interactions with other markets, particularly for hydrogen and renewable electricity, and with the energy system as a whole. The work will be supported by legal expertise as needed.

DIW Team

Contact

Jörn C. Richstein
Jörn C. Richstein

Senior Research Associate / Thematic Lead Electricity Markets in the Climate Policy Department

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