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Carbon Pricing in Times of COVID-19: What Has Changed in G20 Economies?

 

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Published 27 October 2021

 

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There is a growing awareness among countries that a transition to net zero greenhouse gas (GHG) emissions by around the middle of the century is essential for containing the risks of dangerous climate change. Many countries have responded with ambitious emission reduction targets. Now is the time to translate the long-term ambitions into concrete policy packages that deliver the necessary transformational change. Carbon pricing is a powerful tool that can help countries meet climate objectives and support a green recovery. This report takes stock of how carbon prices have evolved across G20 economies between 2018 and 2021. It estimates carbon prices resulting from carbon taxes, emissions trading systems, and fuel excise taxes. G20 countries account for approximately 80% of global GHG emissions.

 

Highlights

 

 

 

Country Summaries and data

Argentina | Australia | Brazil | Canada | China | France | Germany | India | Indonesia | Italy | Japan | Korea | Mexico | The Russian Federation | South Africa | Turkey | United Kingdom | United States

 

Join us at the OECD COP26 Virtual Pavilion

No time to rest – Stepping up carbon pricing efforts to meet climate goals

3 November 2021 | 16:00-17:00 CET | COP26 Goal: Mitigation

With nearly 30 events, the OECD COP26 Virtual Pavilion gathered leading experts to discuss solutions to accelerate climate action and reach the goals of the Paris Agreement. This event looked at the role of carbon pricing in driving greenhouse gas reductions and highlighted the latest carbon pricing progress in G20 countries – which together account for over 80% of energy emissions. Watch as panellists discuss how to advance carbon pricing and greenhouse gas mitigation efforts for climate action.

 

Related READING

book Taxing Energy Use 2019: Using Taxes for Climate Action

Taxing Energy Use provides unique information on energy and carbon taxes in OECD and G20 countries. Tax rates and tax base coverage are detailed by country, sector, energy source and tax type. The use of a common methodology ensures full comparability of tax rates and structures across countries. Summary indicators facilitate cross-country comparisons. Well-designed energy tax systems encourage citizens and investors to favour clean over polluting energy sources. Reforming energy tax systems is a key component in the fight against climate change and delivers co-benefits in the form of reduced health damages from local air pollution.
book Effective Carbon Rates 2021: Pricing Carbon Emissions through Taxes and Emissions Trading

Carbon pricing very effectively encourages the shift of production and consumption choices towards low and zero carbon options that is required to limit climate change. Are countries using this tool to its full potential? This report measures the pricing of CO2-emissions from energy use in 44 OECD and G20 countries, covering around 80% of world emissions. The analysis takes a comprehensive view of carbon prices, including fuel excise taxes, carbon taxes and tradable emission permit prices. The "carbon pricing score" measures how close the 44 countries, together as well as individually, are to the goal of pricing all energy related carbon emissions at current and forward-looking benchmark values for carbon costs. The report highlights the structure of effective carbon rates across countries and sectors in 2018 and discusses change compared to 2012 and 2015. It also provides an outlook on recent trends in emissions trading in China and the European Union.

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