In April of 2015 at a forum on the British Columbia carbon tax at MIT, I heard Merran Smith of Clean Energy Canada (http://cleanenergycanada.org) say if you add up the GDP of all the individual countries which have some kind of price on carbon, either an emission trading scheme (ETS) or a direct tax, it adds up to 42% of global GDP now and, by the end of 2016 when another five provinces in China come on board, it will be over 50%. (You can hear and see Merran Smith say this at 28:20 into this video of the MIT event at https://www.youtube.com/watch?… ).
Having heard expert after expert say, “We need a price on carbon” in order to address climate change, this struck me. Was Merran Smith correct? Have we already begun to put a price on carbon? Looking a little further, I found a variety of carbon pricing structures – carbon taxes, emissions trading schemes, and even internal prices on carbon from individual businesses.
The World Bank 2015 carbon report advance brief ( http://documents.worldbank.org… ) puts it a little differently than Clean Energy Canada:
“In 2015, about 40 national and over 20 subnational jurisdictions, representing almost a quarter of global greenhouse gas emissions (GHG), are putting a price on carbon…
“The total value of the emissions trading schemes (ETSs) reported in the State and Trends of Carbon Pricing 2014 report was about US$30 billion (US$32 billion to be precise). Despite the repeal of Australia’s Carbon Pricing Mechanism in July 2014, and mainly due to the launch of the Korean ETS and the expansion of GHG emissions coverage in the California and Quebec ETSs, the value of global ETSs as of April 1, 2015 increased slightly to about US$34 billion. In addition, carbon taxes around the world, valued for the first time in this report, are about US$14 billion. Combined, the value of the carbon pricing mechanisms globally in 2015 is estimated to be just under US$50 billion…
“In addition, the adoption of an internal carbon price in business strategies is spreading, even in regions where carbon pricing has not been legislated. Currently, at least 150 companies are using an internal price on carbon. These companies represent diverse sectors, including consumer goods, energy, finance, industry, manufacturing, and utilities.”
Continue reading The Current Cost of Carbon