Carbon Pricing Initiatives Are Gaining Momentum

(26 July 2021) According to the World Bank’s State and Trends of Carbon Pricing 2021, there are 64 carbon pricing schemes in operation around the world today, covering over 21% of global emissions and generating over $50 billion of revenue per year.

• Though the share of global greenhouse gas (GHG) emissions covered by carbon pricing initiatives is growing fast, with a threefold increase over the last decade, experts note that thus far less than 4% of global emissions are covered by a carbon price higher than $40 per ton of carbon equivalent — the price they warn is needed to meet the 2C target (the goal of keeping global temperature rise to less than 2°C above pre-industrial levels).
• Of the ten largest producers of GHG emissions, six — the US, India, Russia, Brazil, Indonesia and Iran — have not yet introduced national-level carbon pricing schemes. Together, these six countries account for over 30% of global GHG emissions.

Note: To discourage consumption of carbon-intensive resources and services, the government sets a price (or a carbon tax) that emitters must pay for each ton of greenhouse gas emissions they emit. Businesses and consumers will take steps, such as switching fuels or adopting new technologies, to reduce their emissions to avoid paying the tax. And government will redistribute the revenue from carbon pricing to increase investment in green energy, carbon free technologies and climate adaptation. (C2ES).