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Market Trading Mechanisms for Delivering Energy Efficiency

Published in 2010

Market Trading Mechanisms

The use of market mechanisms to achieve environmental objectives is growing, with the most notable example being the use of emissions trading schemes to control greenhouse gas emissions. Trading Mechanisms for Energy Efficiency, commonly referred to as White Certificates Schemes, are now in place in a few countries. This study examines these experiences with White Certificates Schemes, identifies the key design features that affect performance, evaluates effectiveness and offers advice on how developed and transition economies might proceed with such schemes. The report also considers the use of White Certificates Schemes in conjunction with Renewable Energy Trading (Green Certificates) and Emissions Trading.

The Working Group on Energy Efficiency and Related Environmental Aspects (the PEEREA Working Group) monitors the implementation of the Energy Charter Protocol on Energy Efficiency and Related Environmental Aspects signed by 51 Member Countries and the European Communities. An important role for the Working Group is joint analysis and discussion of innovative policy instruments to promote energy efficiency in member countries. This publication is one of many that have been produced by the Energy Charter Secretariat to support this role.

This document was prepared by Mr. Vlasis Oikonomou of the Joint Implementation Network, under the guidance of the Energy Efficiency and Investment Directorate of the Energy Charter Secretariat. Special thanks go to Silvia Rezessy (Joint Reseach Centre, European Commission), Daniele Russolillo (Fondazione per l'Ambiente 'T. Fenoglio', Italy), Adriaan Perrels (VATT, Finland), James Acord (DECC, UK), Prof. Zmijewski (Poland), and Louis-Gaetan Giraudet (CIRED, France) for providing useful information on the updates of the WhC schemes. Ms. Valya Peeva and Mr. Gene McGlynn of the Enegy Charter Secretariat also provided valuable guidance and advice. The report benefited from comments by delegates of the PEEREA Working Group Meeting held in November 2009.