Green recovery

Putting a price on carbon

26/10/2021 PNG

Carbon pricing in G20 economies – in the form of emissions trading systems (ETS), carbon taxes or fuel excise duties – applies to 49% of all energy-related emissions in 2021, up from 37% in 2018.

More carbon pricing in the electricity sector – up to 64% from 31% in the same period – accounted for much of that increase, driven by the introduction of the Chinese national ETS for the power sector and an expansion of carbon pricing in Canada.

Other sectors saw little change, with the lowest overall coverage in buildings, at 21% (the mild increase in this sector accounted for by explicit carbon pricing initiatives in Canada and Germany).

Effective carbon rates, as opposed to coverage rates (not shown in this chart), continue to be highest in road transport and lowest in the industry and electricity sectors. The average effective carbon rate across G20 countries in road transport is EUR 88 per tonne of CO2 (due to relatively high rates of existing excise taxes), compared to EUR 3.77 for industry and EUR 6.36 for electricity.

See also: Carbon Pricing in Times of COVID-19 What has changed in G20 economies?