SFL’s Vice-director Dr. Mark Sanctuary together with Professor Rikard Forslid and Associate Professor Shon Ferguson presented on Tuesday their SNS report for the SNS Centre for Business and Policy Studies on ”Carbon dioxide leakage or competitive advantage? – On the necessary balancing act between industry and climate policy” (”Koldioxidläckage eller konkurrensfördel? Om balansgången mellan industri- och klimatpolitik”). In their report, they reflect and examine the necessary balance required between industry and climate policy – providing an overview of the current research situation and an analysis of the situation in Sweden.
They discuss how the environmental requirements in Sweden have so far not resulted in Swedish industry moving production and emissions abroad to any great extent, and that some of the major factors behind this are companies’ low costs for carbon dioxide emissions and the access to cheap and clean electricity. However in turn they highlight that the situation could now change as prices rise, which in turn places serious demands on climate and industrial policy. As global warming is independent of where the greenhouse gases are released this sort of ‘leakage’ (i.e. production and emissions moving to another country) may seriously undermine the effectiveness of individual countries’ climate policies, which in turn poses a serious threat to the efforts to reduce emissions.
In their SNS report, researchers Shon Ferguson, Rikard Forslid and Mark Sanctuary reflect on these facts (and more) and examines the necessary balance required between industry and climate policy – providing an overview of the current research situation and an analysis of the situation in Sweden.
Access their SNS report here.
Read their debate article published by Dagens industri.
Watch them present and discuss their report below at SNS: