Some sectors do not have any incentives in reducing emissions, despite a large abatement potential (e.g. some export-oriented sectors in agriculture and manufacturing) (OECD, 201 la). Germany should consider further simplifying its climate change policy by first listing instruments used, identifying the externalities they are targeting, assessing whether they are cost-effective in addressing those externalities and identifying potential overlaps and loopholes. When designing the policy, the cost and benefits of the measures envisaged against the objectives they are supposed to serve should be carefully assessed. Particular attention should be given to the interaction with the EU ETS to limit overlaps. For example, the criteria used to select the abatement measures could be made clearer, as evaluations show that options which are cheaper than those considered in the Integrated Energy and Climate Programme exist (such as the replacement of three to four low efficiency lignite fired-power plants) (BMU, 2008b).