EPS, ETS, Renewable obligations and feed in tariffs — Critical reflections on the compatibility of different instruments to combat climate change

Abstract The Energy Sector is facing its biggest upheaval. Governments around the globe are discussing the best way to combat climate change. Different mechanisms and policies have been introduced to reach a global carbon dioxide reduction of up to 80% by 2050, based on 1990 emission levels. The difficulties in applying different instruments at the same time are often not considered in the discussion of different instruments. However to achieve an effective and efficient reduction of emissions, a look at the whole bundle of instruments and their interrelationship is necessary when future regulations are discussed. This paper will critically assess the effects and the interrelationship of ETS, EPS and feed in tariffs from a European perspective.