The European Union's Emissions Trading System (EU ETS) is the world's largest carbon trading market. This book offers a new perspective on the EU ETS as a multi-level governance regime, in which the regulatory process is composed of three distinct 'competences' - norm setting, implementation, and enforcement. Are these competences best combined in a single regulator at one level of government or would they be better allocated among a variety of regulators at different levels of government? The combined legal, economic, and political analysis in this book reveals that the actual allocation of competences within the EU ETS diverges from a hypothetical ideal allocation in important ways, and provides a political economy explanation for the existing allocation of norm setting, implementation and enforcement competences among various levels of European government.
Supranational governance is being challenged by politicians and citizens around the EU as over-centralized and undemocratic. This book is premised on the idea that polycentric governance, developed by Vincent and Elinor Ostrom, is a fruitful place to start for addressing this challenge. Assessing the presence of, and potential for, polycentric governance within the EU means approaching established principles and practices from a new perspective. While the debate on these issues is rich, longstanding and interdisciplinary, it has proven difficult to sidestep the 'renationalisation/federalisation' dichotomy. The aim of this volume is not to reject the EU's institutional structure but provide a different benchmark for the assessment of its functioning. Polycentric theory highlights the importance of multilevel horizontal relationships within the EU - between states, but also between many sub-state actors, all the way down to individuals. This helps us answer the question: how do we achiev
