This report was prepared by the Tax Policy and Statistics division of the OECD’s Centre for Tax Policy and Administration. It is unique in its comprehensive take on carbon pricing and energy taxation, integrating price signals that result from fuel excise taxes, carbon taxes and emissions trading systems into a single “Effective Carbon Rates” metric.
The report is part of the OECD series on Carbon Pricing and Energy Taxation. It covers 79 countries accounting for 82% of global greenhouse emissions in 2023. It provides descriptive evidence on Effective Carbon Rates (ECRs) in 2023 and discusses recent developments in the carbon pricing space in 2024 and 2025, focussing on emissions trading systems and elaborating on built-in flexibility mechanisms in this instrument.
Detailed data on Effective Carbon Rates broken down by country, sector and fuel as well as by ECR instrument (fuel excise taxes, carbon taxes and emissions trading systems) are available in the Carbon Pricing and Energy Taxation database on the OECD’s Data Explorer.
The Report is structured as follows:
Chapter 1 provides context and briefly describes the OECD Effective Carbon Rates as well as the scope of the report.
Chapter 2 describes Effective Carbon Rates in 2023 with a deep dive on emissions trading systems and the impact of free allowances on ECRs.
Chapter 3 reviews recent and upcoming changes in the carbon pricing area and the impact of main changes in emissions trading systems on Effective Carbon Rates in 2024 and 2025.
Chapter 4 provides a special feature on emissions trading systems: the design of their cap, the free allowance allocation methods and the different compliance options they offer (including the use of carbon credits).
Annex A provides a description of the Effective Carbon Rates definitions of sectors and fuels and briefly goes over its underlying methodology.
Annex B provides information on the estimation of coverage of and permit prices for the thirty-four emissions trading systems which are included in the analysis of this edition of Effective Carbon Rates.