Developing and implementing emissions trading and other measures in climate protection policy were discussed at a Lunch Discussion on 23 September 2004, in Washington, DC. The event focused on experiences and opportunities for transatlantic cooperation. It was co-hosted by the Heinrich Boell Foundation and the Center for Transatlantic Relations of Johns Hopkins University; Ecologic director R. Andreas Kraemer spoke on the EU Emissions Trading Scheme.

The climate policies in the United States were presented by Ned Helme, Executive Director, Center for Clean Air Policy, Washington, DC. The ensuing discussion of economic, policy and legal issues was based on questions taken from the audience. The moderator was David Michel of the Center for Transatlantic Relations of Johns Hopkins University. Marc Berthold of the Heinrich Boell Foundation opened the Lunch Discussion.

In his presentation, R. Andreas Kraemer explained the EU Directive 2003/87/EC of 13 October 2003 establishing a scheme for greenhouse gas emissions allowance trading within the Community, which is the legal basis for emissions trading starting in Europe on 1 January 2005. He reviewed the current status in the development and adoption of national allocation plans for the tradable allowances and highlighted the Linking Directive, which introduces clauses that might eventually allow US businesses to benefit from the European trading scheme. This Directive, which amends the EU Directive 2003/87/EC asks the European Commission to see how credits from regional trading schemes in countries that do not ratify the Kyoto Protocol, such as the US or Australia, can be brought into the European market. This possibility is contingent on the entry into force of the Kyoto Protocol.

Speculating on the likely future development of the European emissions trading scheme, R. Andreas Kraemer predicted that trading will start in early 2005, with all or almost all Member States participating and covering the bulk of carbon dioxide emissions. Coverage will the gradually widen. Prices are expected to be low initially and during the period 2005 to 2007, because of generous allocations and the possibility of credits from Russia entering the European market. During this phase with low economic impact of the trading scheme, a number of teething problems will be encountered and solved. This will leave the EU as a whole with a tested trading scheme and in pole position in 2008, when prices are expected to rise somewhat.

The discussion on the opportunities for transatlantic cooperation underlined a widely shared desire to ensure that energy and climate policy achievements in the US, notably at the state level, be evaluated so that lessons be drawn and incorporated in to future policy designs. Various obstacles and opportunities for a renewed engagement of the United States in the Kyoto Process were aired.