Effective Carbon Rates: Pricing CO2 through Taxes and Emissions Trading Systems (OECD)
Pricing carbon is one of the most effective and lowest-cost ways of reducing CO2 emissions. This OECD report presents the first full analysis of the use of carbon pricing on energy in 41 OECD and G20 economies, covering 80% of global energy use and CO2 emissions. The analysis includes specific taxes on energy use, carbon taxes and tradable emission permit prices, indicating the distribution of effective carbon rates by country and the composition of effective carbon rates by six economic sectors within each country. The analysis finds that carbon prices are often very low, but some countries price significant shares of their carbon emissions. The ‘carbon pricing gap’, which shows the extent to which effective carbon rates fall short of pricing emissions at EUR 30 per tonne, sheds light on potential ways of strengthening carbon pricing. Read the report online on the OECD website.