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Effective Carbon Rates

Pricing CO2 through Taxes and Emissions Trading Systems

Published on September 26, 2016

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To tackle climate change, CO2 emissions need to be cut. Pricing carbon is one of the most effective and lowest-cost ways of inducing such cuts. This 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 of CO2 emissions. The analysis takes a comprehensive view of carbon prices, including specific taxes on energy use, carbon taxes and tradable emission permit prices. It shows the entire distribution of effective carbon rates by country and the composition of effective carbon rates by six economic sectors within each country. Carbon prices are seen to be often very low, but some countries price significant shares of their carbon emissions. The ‘carbon pricing gap’, a synthetic indicator showing the extent to which effective carbon rates fall short of pricing emissions at EUR 30 per tonne, the low-end estimate of the cost of carbon used in this study, sheds light on potential ways of strengthening carbon pricing.

BLOGS AND HIGHLIGHTS

 

Country PROFILES

| Argentina | Australia | Austria | Belgium | Canada | Chile | China |  Czech Republic | Denmark | Estonia | Finland | France | Germany | Greece | Hungary | Iceland | India | Indonesia | Ireland | Israel | Italy | Japan | Korea | Luxembourg | Mexico | Netherlands | New Zealand | Norway | Poland | Portugal | Russia | Slovak Republic | Slovenia | South Africa | Spain | Sweden | Switzerland | Turkey | United Kingdom | United States |

 

webcast: OECD GREEN TALKS 

MIND THE GAP... MEASURING THE CARBON PRICING SHORTFALL

90% of emissions from energy use are priced at less than EUR 30 per tonne, a lower-end estimate of the damage from emitting 1 tone of CO2 and 60% of emissions are subject to no price whatsoever. We are making poor use of carbon pricing, a acost-effective means of reducing CO2 emissions

OECD Environment Director, Simon Upton, hosts Kurt van Dender, OECD environmental tax policy expert from the Centre for Tax Policy and Administration to discuss the OECD's forthcoming publication on effective carbon rates - a new, combined measure of the extent to which countries use taxes and emissions trading systems to price carbon, and to introduce the carbon pricing gap.

» Watch the replay 

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