After a three-year hiatus, the International Carbon Action Partnership (ICAP) resumed in-person trainings with the 2022 edition of its flagship training activity, the two-week ICAP Summer School on Emissions trading. The training took place in Florence (Italy) from 22 August to 2 September 2022. Participation in the summer school was open to applicants from emerging economies and developing countries. The course was aimed at public officials or stakeholders from the non-governmental, academic and private sectors who are or will be involved in deciding on, designing and implementing carbon pricing mechanisms.

The ICAP Summer School 2022 was hosted by the European University Institute (EUI), Florence, Italy. It was implemented by Ecologic Institute and Get2c on behalf of ICAP, the International Carbon Action Partnership. It is made possible through the generous support of the European Commission.

Background

Emissions trading is a market-based instrument for climate change mitigation. From the EU to South Korea and from China to California, more and more jurisdictions around the world use emissions trading as a tool to achieve their climate goals. At the beginning of 2022, around 17 percent of global greenhouse gas emissions are covered by emissions trading systems (ETS). Emerging economies and developing countries around the world are taking steps towards developing such systems.

From 22 August to 2 September 2022, the International Carbon Action Partnership (ICAP) convened a two-week ETS training course to provide training at the intermediate level on how to apply emissions trading in emerging economies and developing countries. Over the course of two full weeks, participants explored concepts and key elements of ETS implementation, through a mix of presentations from expert speakers and policy practitioners as well as interactive activities. Each session drew on experiences from existing ETS to explain the main design choices for setting up an ETS and to convey solutions for their implementation.

Format and Content

The curriculum of the ICAP Summer School covered the role of emissions trading as a policy instrument for climate policy, providing illustration through many hands-on examples, practical experience and case studies. It addressed a range of issues faced in the design of emissions trading systems (ETS), considering the specific needs, circumstances and perspectives of emerging economies and developing countries. Covered issues include:

• Defining scope and coverage of an ETS
• Setting the cap, allowing for offsets and balancing supply and demand of allowances
• Allocation methods
• Data collection and inventory generation
• Ensuring compliance through monitoring, reporting, verification and enforcement
• Registry design and implementation

Additionally, the course explored important steps in the implementation of an emissions trading system, with consideration to specific needs and interests of developing countries. This includes:

• Administrative structures and legal framework
• Stakeholder engagement
• Addressing competitiveness concerns and the carbon leakage risk
• Impacts on and responses from covered entities
• Carbon market analysis and drivers
• Regulation and oversight of the carbon market
• Strategies and pathways towards introducing carbon pricing systems
• Opportunities for regional cooperation on carbon market implementation

Team-building activities were an important component of the ICAP Summer School and were fostered through break-out sessions and frequent working groups. Participants were encouraged to share any relevant experiences from their jurisdictions, to support peer learning.