Implementation of the EU ETS2 System in 2027 and Its Potential Impacts on Consumers in the Czech Republic Tereza Fidlerova: Implementation of the EU ETS2 System in 2027 and Its Potential Impacts on Consumers in the Czech Republic

This bachelor thesis examines the introduction of the EU ETS2 system and its potential impacts on consumers in the Czech Republic. The aim of the thesis is to analyze how the implementation of the emissions trading system for the buildings and road transport sectors will affect the expenditures of different types of Czech households. The theoretical part is based on economic theories of market and government failure, externalities, public goods, tax incidence, and environmental policy instruments, while explaining the economic principles of the EU ETS2 system. The theoretical section also includes a literature review focused on EU ETS2 price scenarios, market expectations, and its social and economic impacts, which forms the basis for the analytical part of the thesis. The practical part applies scenario and comparative analysis, in which three emission allowance price scenarios and five model households representing different income groups, heating methods, and transport behavior were created. The results show that the additional costs associated with the implementation of the EU ETS2 system range from 0,30 % to 3,04 % of a household’s annual income, depending on the pricing scenario and household characteristics. The thesis also includes a questionnaire survey focused on household attitudes toward rising energy and fuel prices and their ability to respond to the impacts of the EU ETS2 systém. The results indicate that the impacts of the EU ETS2 system will differ significantly across households, particularly depending on heating methods, the level of energy and fuel consumption, the use of car transport, and households’ ability to adapt to rising costs, while the system may have a relatively regressive character.