ECONOMIC MECHANISMS OF ENVIRONMENTAL MANAGEMENT: EVOLUTION AND CURRENT TRENDS WITH PROSPECTS FOR UKRAINIAN REALITIES

Abstract

In view of the ongoing climate degradation, the article analyses and compares the most commonly used mechanisms for preventing negative environmental impacts resulting from human activities. In this respect, administrative and economic mechanisms are considered, which have a significantly different nature. Based on the consideration of the specific features of these approaches, the advantages of economic methods that provide incentives for individual enterprises to implement the necessary environmental protection measures, as opposed to purely administrative and restrictive measures inherent in command-and-control  approach.

Among the economic mechanisms of environmental management of climate change, as one of the most painful problem of our time, the main attention is paid to the principle of direct financial taxation and the method of market trading in emission quotas, which is commonly known as cap and trade systems. The advantages and disadvantages of these approaches to limiting anthropogenic greenhouse gas emissions are presented and analysed, and the range of application of these basic economic instruments in different countries of the world is demonstrated.

It is noted that the Association Agreement between Ukraine and the European Union provides for the introduction in the coming years of a national greenhouse gas trading system adapted to the pan-European system that has been in place since 2005. In this regard    current state of the national ETS system implementation is analysed with the first essential step of which being the putting in force a carbon emissions monitoring, reporting and verification system.