Sandbag publishes a new briefing on Stabilising the Market Stability Reserve
Sandbag has published analysis of the impact of Phase 4 EU ETS reforms on the Market Stability Reserve (MSR) to accompany its latest briefing – ‘Aligning the surplus with reality‘.
Sandbag’s projections show that under many scenarios the MSR will grow to contain several billion allowances. This risks endangering both market stability and long term environmental goals. A threshold needs to be put in place to limit the size of the MSR with allowances above this threshold retired.
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