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Aviation and the EU ETS - Lessons learned from previous emissions trading schemes

Designing an emissions trading scheme requires in-depth knowledge about several aspects. This paper attempts to clarify some important design points of the forthcoming emissions trading scheme for aviation under the EU ETS. Five general key points of system design are acknowledged and comparisons are made to previous and current emission trading schemes. Above all, it is argued that initial allocations of emission permits and the trade barrier between the aviation sector and EU ETS need to be carefully examined.