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The carbon abatement incentives that countries have put in place for different sectors of the economy, explicitly or implicitly, is of great political interest. OECD has launched a project aiming to assess these incentives in selected countries and sectors, building on the report Carbon Emission Policies in Key Economies that the Australian Productivity Commission published in 2011. The hope is that the project can give a rough indication of the relative stringency of different policy instruments in place in these sectors in the respective countries.

The project assesses the costs to society of the different policy measures, their (relatively short-term) impacts on carbon emissions, and calculates the costs per unit of CO₂ abated. Emission changes are estimated in the latest year for which data are available – normally 2010.

The report by the Productivity Commission covered explicit and implicit carbon abatement incentives in selected policies addressing electricity generation and road transport in China, Germany, India, Japan, Korea, New Zealand, the United Kingdom and the United States. The OECD is extending the country coverage to include Brazil, Chile, Denmark, Estonia, France, South Africa and Spain. It is also expanding the sectoral coverage to include carbon abatement incentives in the pulp & paper and the cement sectors, as well as in relation to household energy use. These two industrial sectors will also be covered for the countries that the Productivity Commission addressed. In addition, the household sector will be included in as many of those countries as possible.

It is expected to publish the case studies and a synthesis report in 2013.