Abstract for: Modelling EU27’s Emission Offset Strategy for Achieving Long-Term 2°C Mitigation Targets

In the realm of policymaking, the practice of regional carbon budgeting remains underexplored despite its critical role in advancing global climate objectives, notably the Paris Agreement's imperative of capping global temperature rise at 2°C by 2050. Within this study, we present the "Pledge Limits Evaluation for Decarbonization: Goals of the EU27 Strategy" (PLEDGES) model, an innovative system dynamics-driven simulation platform tailored to the European Union's context. This tool aims to equitably distribute carbon budgets among Member States and institute an emissions offset strategy to address unforeseen discrepancies from the EU27's carbon budget. Grounded in the "Gains from Trade" framework, the emissions trading mechanism is deployed to facilitate equitable exchange. Moreover, the tool incorporates a mechanism to evaluate the financial implications of offsetting through the utilization of abatement cost curves specific to each Member State.