Looking into the blackbox of climate policy making: Policymakers’ perceptions of the EU-ETS

Ambitious instrumentation and implementation is what the future of the planet depends on and what is crucially needed in order to achieve the Paris goals (Perino et al., 2022). The European Union aims to become a leader in ambitious climate action with the formulation of the European Green Deal and the negotiation of the practical implementation within the Fit-for-55 package (Boasson & Tatham, 2023). Yet, we know little to nothing about why policymakers choose certain tools over others and what determines their design (Capano & Howlett, 2020). Policy instrument theory is mostly concerned with what instruments policymakers should choose. Conventional policy theory is greatly interested in the power dynamics behind goal definition, either neglecting policy instruments or treating them as purely technical ‘tools’. Yet, as constructivist policy instrument literature rightly points out: policy instruments are not neutral, they are normative themselves (Ringeling & van Nispen, 1998), can develop lives of their own (Voß & Simons, 2018) and actually become institutions in themselves (Lascoumes & Le Gales, 2007). This article sheds light on the policy formulation of the Fit-for-55 package within the realm of the European Green Deal. It is based on 39 expert interviews from Germany, France, Poland and on the EU level. The interviews were conducted based on a semi-structured questionnaire between April 2022 and April 2023, throughout the period of the renegotiation of the Emissions Trading System (EU-ETS) in the Fit-for-55 package. Interview-partners comprise policymakers in parliament as well as ministerial bureaucrats (state actors) and representatives of the most relevant interest groups in the policy subsystem, from environmental organizations to high-emitting industry (non-state actors). We find that policymakers’ perceptions of policy instruments are a crucial determinant when it comes to choice and design of instruments. We conceptualize policymakers’ instrument perceptions alongside the triad of Sabatier’s (1991) beliefs framework in the Advocacy Coalitions Framework: core-beliefs, policy beliefs and instrument beliefs (Weible et al., 2012). Refuting assumptions of policy design theory, policymakers are by no means passive learners: they have agency, filter and evaluate academic knowledge according to their own beliefs and they chose instruments based on criteria that match their own core beliefs. Accordingly, instrument perceptions and design preferences surrounding the EU-ETS move across the two dominating transformation paradigms currently present in real policymaking: Green Keynesianism and Green Economy (Schulze Waltrup, 2023). The negotiations around the EU-ETS are dominated by differing core-beliefs on the relationship of the state and the market, with Green Economists, in a neo-classical sense, favouring as little state intervention as possible, let alone the introduction of supplementing regulatory instruments. In contrast, Green Keynesianists doubt whether the ETS alone will be the “superhero” saving the planet and consider measures supporting the societal transformation: creating infrastructure, investing in technological innovation, reskilling of workers and structural policies for affected regions. Yet, it very much depends on the framing of an instrument. Finally, we find that policymakers from politically opposing camps find justifications for themselves to support the EU-ETS.