This report uses a dynamic CGE model, to assess the rate of carbon leakage and the adverse impacts on competitiveness in a number of scenarios over the period 2010‐2050. The report is structured as follows: Chapter 3 reviews the economic modelling literature on anti‐leakage policy instruments. Chapter 4 presents the CGE model and describes the main assumptions and data. Chapter 5 describes the baseline and the policy scenarios. Chapter 6 reports the simulation results. Chapter 7 presents the assessment of the anti‐leakage policy options in terms of the CECILIA2050’s optimality criteria.

This report examines the implications of a range of possible agreements for the reduction of greenhouse gases (GHGs) from industrial and terrestrial sources in terms of the likely future temperature increase, mitigation costs by region and a number of other important indicators. The agreements that are considered range from the case where the EU goes alone for a target reduction of 80% by 2050, to the case in which most of the countries of the world commit themselves to this reduction target.