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Decarbonizing economies through carbon pricing - is there an ideal policy mix? - the case of Germany´s energy sector
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Explicit and implicit carbon pricing are indispensable to reduce emissions and direct economies towards carbon neutrality. This report aimed to investigate whether there is a policy mix that is the most effective in emission reduction. A cluster analysis showed that stringent market-based instruments such as the CO2 tax are substantial for effective emission abatement. In a second step, a political feasibility analysis was conducted to investigate how Germany can improve its environmental energy policy framework further. It was identified that phase-out of fossil fuel subsidies, investments in renewables and complementary policies are crucial to facilitate the decarbonization of Germany’s energy sector.
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Climate change Decarbonization Carbon pricing