Global Environmental Change, Vol 20, No 2, 2010, pp. 314-321.
The EU has developed the first and largest international emissions trading system in the world. This development is puzzling due to the EU’s scepticism to international emissions trading in greenhouse gases (GHGs) in the run-up to the 1997 Kyoto Protocol. This article analyses how the EU ETS was initiated in the first place mainly from the perspectives of Liberal Intergovernmentalism (LI) and Multi-level Governance (MLG). LI emphasises change in the positions of the EU member states as the key to understand what happened and why, whereas MLG opens up for change in the position of supranational entrepreneurial leaders as the key explanation. The main conclusion is that entrepreneurial epistemic leadership exercised by the European Commission was crucial for making the EU ETS. The principal means of leadership involved building up independent expertise on how an EU ETS could be designed, and mobilizing support from state and non-state actors at various levels of decision-making. This type of leadership may be needed more generally to deal with challenges characterized by high scientific uncertainty and social complexity in which learning is pertinent, such as climate change.