Infographic - Carbon Pricing in Canada

E - Business Carbon Pricing Advocacy

E - Cap and Dividend

E - Cap and Trade Performance

E - Carbon Markets Performance

E - Carbon Price Design

E - Carbon pricing politics

E - Carbon Pricing Coverage

E - Carbon Pricing History and Trends

E - Carbon Pricing Impacts

E - Carbon Pricing in Practice

E - Carbon Pricing Required for Emissions Targets

E - Carbon Pricing Revenues and Use

E - Carbon Pricing Scenarios and Forecasts

E - Carbon Taxation

E - Case for Carbon Pricing

E - Company-Specific Carbon Pricing

E - COP26 Carbon Markets

E - Efficient Optimal Carbon Pricing

E - Evaluating Carbon Pricing

E - Implicit Carbon Price of Policies and Measures

E - Internal Business Carbon Pricing

E - Negotiating a Global Carbon Price

E - Revenue Neutral Carbon Tax

E - SCC as Carbon Price

E - Sectoral Carbon Pricing and Pathways

E - Shadow Pricing

E - UNFCCC Article 6 and ITMOs Offsets

2012 The study concluded that policy and technology change in risk, but impacts almost irrelevant

2015 Other ways to get to same objective, e.g. $30/ton carbon tax

2015 Other ways to get to same objective, e.g. $30/ton carbon tax

2015 The 2oC Framework

2015 The 2oC portfolio approach

2015 Translating a 2oC scenario into a 2oC benchmark - 12

2016 Carbon price impact stress-testing approach

2016 Comparison of relevant signposts within physical climate scenarios

2016 Horizontal vs. vertical perspective on carbon pricing

2016 Horizontal vs. vertical perspective on carbon pricing

2016 Impact of policy distortions on apparent abatement cost

2016 Impact of policy distortions on apparent abatement cost

2016 Impact of WAIS collapse by 2200 modest in terms of suggested SCC

2016 Impact of WAIS collapse by 2200 modest in terms of suggested SCC

2016 Linking real assets to financial portfolios (9)

2016 Low carbon impact smart beta portfolio

2016 Mapping GHG productivity along value chains

2016 Mapping GHG productivity along value chains

2016 Objectives of the report

2016 Oil production costs vary widely

2016 Oil production costs vary widely

2016 Overview of carbon pricing by the numbers

2016 Overview of carbon pricing by the numbers

2016 Position of companies on introducing carbon pricing

2016 Position of companies on introducing carbon pricing

2016 Potential price impact of global carbon price after revenue recycling

2016 Prices in existing carbon pricing initiatives

2016 Relative sector impact on PBT by 2020

2016 Risks are long-term, investment focus short-term

2016 Testing 2D alignment for real assets

2016 Testing the alignment of real assets with a 2D target (4)

2016 There is no demand for long-term analysis (19)

2016 Transition scenarios - IEA outlook to 2040

2016 Voluntary vs. mandatory ways to respond to scenario challenges

2017 10 year and 35 year results

2017 35 year sensitivity

2017 Carbon price corridor for the power sector

2017 Carbon pricing could cover costs of universal access to basic services

2017 Carbon revenue recycling can benefit poor

2017 Carbon revenues could significantly expand social assistance

2017 Equity holds of financial actors, top 15 funds, and top 15 banks

2017 First and second round bank equity losses

2017 Heat maps - sensitivity of asset classes to climate risk factors

2017 OPTrust TRIP Expsoures

2017 Portfolio impacts at 10 years

2017 Portfolio impacts at 10 years

2017 Portfolio impacts at 10 years

2017 Reclassified NACE sectors to climate-policy-relevant sectors

2017 Risk factors illustrated relatively by scenario

2017 Sensitivity to TRIP risk factors by OPTrust greatest over short term

2018 Recent trends in carbon pricing

2018 The carbon pricing gap for OECD and G20 Countries

2021 A large gap remains between 2030 commitments and Paris Agreement goals

2021 Additional benefits compared to NDC-like pathway out to 2100

2021 Calculated components of the price of carbon facing Norwegian motorists as of 2019

2021 Comparing the latest year 2100 warming projections for different scenarios

2021 IPR carbon price policy forecast

2021 Voluntary carbon credit prices and demand 2019 by project type

2021 Voluntary carbon credit prices and demand 2019 by vintage

Australian Carbon Prices and Food Prices

Calculated "marginal" benefit cost ratio for 2011

Carbon credit prices Jan-Nov 2021 - Platt

Carbon Pricing by Country

Carbon Pricing Coverage by Country

Cheap energy is important for less poverty and better health

Coal keeps electricity prices down

Delegates associated with fossil fuel industries outnumbered national delegations at COP26

Forward looking benefit cost ratios

GDP will continue to rise rapidly

Impact of Carbon Pricing

One can project the "CO2 Yield for Crops in the Future

Progress on near-term and long-term commitments

Revised 2013 Social Cost of CO2, 2010-2050 ($2007)

Subtracting out benefits of energy from non-fossil fuel sources

The benefit cost ratio for CO2 is huge

The social cost of carbon emissions

"A paradigm shift has happened, " said Svenja Telle, an emerging tech analyst at PitchBook. "Before, climate finance was seen as a task without returns. It was a sinkhole. Now climate finance is seen as one of the most profitable investment strategies out there. That changes everything."

“The difference between 1.5 and 2 degrees is a death sentence for us” -- Aminath Shauna, environment, climate change and technology minister for the Maldives

“We must build connections with those who understand the urgency and the truth of our situation. The mainstream is not our ally and predatory capitalism can never provide a pathway to a stable climate.”

“We're delusional if we think we can save our climate by tweaking a system that rewards exploitation and that measures success with planet destroying increases in GDP. “

1. The #COP26 outcome reflects a deep and long-overdue change in the architecture for climate policy, led in large part by President Biden and his Climate Envoy John Kerry.

2. The new climate architecture includes, first, the acknowledgment that there is now a climate emergency that will quickly become catastrophic and unmanageable without fast mitigation, a focus on 1.5°C as the outer limit for warming, and recognition that this, the 2020s, must be the decisive decade for fast climate action.

3. The new architecture includes the importance of cutting non-CO2 climate emissions, as well as CO2, with a specific focus on #methane, a super climate pollutant responsible for nearly half of today’s warming. Cutting methane is the single biggest and fastest mitigation action the world can take to keep warming from breaching the 1.5°C guardrail.

4. Another aspect of the new architecture is a shift to sectoral agreements—a second front in the climate war, based on strategies that focus on individual sectors of the economy, inspired by the Montreal Protocol.

5. With these outcomes, veterans of COPs will see the glass as more than half full: the climate emergency now acknowledged and the path laid out for keeping the 1.5°C target alive. For young people, they’ll wonder why we’re not taking even stronger action to solve this emergency. They will surely maintain their anger and demands to hold leaders accountable. Without them, we’ll never reach a safer, more equitable future.

200+ scientists’ warning: “We, climate scientists, stress that immediate, strong, rapid, sustained and large-scale actions are necessary to hold global warming to well below 2°C and pursue efforts to limit it to 1.5°C.”

A target-consistent carbon price

A target-consistent carbon price is a lot more reliable than IAM-based SCCs

Agnes Callamard, Amnesty Int’l Sec’y General: “If we do not put our hearts and minds into solving this existential threat to humanity, we lose everything.”

Agnes Callamard, Amnesty Int’l Sec’y General: “The UNFCCC ... has betrayed the very foundations on which the United Nations was built – a pledge first not to countries, nor states, but to the people.”

Agnes Callamard, Amnesty Int’l Sec’y General: “Their failure to commit to maintaining the global temperature rise at 1.5°C will condemn more than half a billion people, mostly in the global south, to insufficient water and hundreds of millions of people to extreme heatwaves.”

Alessandro Vitelli, IETA spokesman: "We're not coming to a shuddering halt today and tomorrow, and suddenly there's going to be no emissions from the combustion of fossil fuels. There is a process to transition that's under way, and carbon markets are the best way to make sure that transition takes place."

Andrea Meza, Costa Rica minister of environment and energy: “If we want to address the climate crisis, we need a managed but decisive phase-out of oil and gas production.”

Andrea Xieu, Mexican collective Futuros Indígenas: “Indigenous nations were not part of the negotiations despite the fact that 80% of the planet’s biodiversity survives in our territories. The problem is not only the blah, blah, blah of politicians, but the bang, bang, bang of greenwashing that will continue to destroy our lives and territories.”

Andrea Xieu, Mexican collective Futuros Indígenas: described the deal as an embarrassment that illustrated the murky influence of fossil fuel companies in Glasgow.

Anna Jones, Greenpeace UK: “What we can’t afford to have is another huge extension of those deadlines to 2030 and then not meet them. We need to be seeing a reversal now.”

Any chance of halving fast-rising emissions by 2030 – the declared aim of the talks – is now negligible.

Article 6: COP26 also finalised rules for global carbon trading. However the fossil fuel industry will be allowed to “offset” its carbon emissions

Article 6: Glasgow pact created rules to prevent double-counting of emissions credits, closed loopholes, and added stronger language make credits being traded across borders represent real reductions in greenhouse gas emissions.

As a climate scientist, watching COP26 conclude without commitments to end carbon dioxide emissions was like watching a group of firefighters standing around squabbling in front of burning houses with children inside.

As governments take real action, carbon prices could rise

As regards all the most important pledges to phase out coal, reduce subsidies and protect forests, Glasgow failed.

Average voluntary market prices should rise to $20-50/tCO2e by 2030

Banks and other investors will be racing to find impactful and creditworthy businesses in which to invest climate capital. This could lead to the rapid scaling up of climate-focused businesses, and as a result a wholesale transformation of the competitive landscape in ‘green’ technologies and manufacturing.

Brandon Wu, the director of policy and campaigns at ActionAid, was highly critical of those who had vilified India for the phrasing of the agreement. Wu, like others, pointed out that the agreement had only targeted coal while avoiding mention of other fossil fuels such as natural gas and oil, which are used in abundance by the US and European countries.

But the biggest breakthrough was unexpected. On Wednesday, China and the U.S. — the world’s two largest climate polluters — said they would commit to “enhanced climate actions” to keep global warming to the limits set in the Paris agreement. Most critically, the statement included a commitment to phase down coal. And while we can’t yet quantify the impacts of this development, it presumably moves us closer to the 1.5 Celsius goal. This level of U.S.-China cooperation quickly shifted the entire COP26 narrative and outlook.

But to ask the human species to give up energy use, which is what is implied by many of the deep reduction targets in a short space of time, is distracting science fiction. These challenges are made even more difficult by having nearly 8bn mouths to feed today, with another 2bn by 2050.

By forcing Parties to “revisit” their NDCs before next year’s COP, the Pact will induce some countries to reconsider their targets and redraw their emissions pathways. And this will cascade down to business, likely pushing many organizations to accelerate their own decarbonization plans.

By laying out the “45% by 2030” emissions target in black and white, the Pact has set a clear benchmark for evaluating the credibility of businesses’ climate transition plans. Those that fail to integrate this target could find themselves the target of climate activists, investors, and even legislators.

By the end of the first week, the latest commitments from various countries for the first time appeared to offer a chance of keeping the warming of the planet below 2 degrees Celsius compared with preindustrial levels. That’s half of what we were heading toward prior to the 2015 Paris summit (COP21).

Carbon Brief estimates that these pledges and NDC updates would – if fully implemented – reduce global temperatures by around 0.1C relative to 2030 commitments in place prior to COP26.

Cautious optimism: US-China agreement to work together

China’s intervention - via India - effectively undermined COP26 President Alok Sharma’s goal to “consign coal to history.”

Claire Stockwell, Climate Analytics: “It is all very well for leaders and governments to claim that they have a net-zero target, but if they don’t have plans as to how to get there, and their 2030 targets are not aligned with net-zero, then, frankly, these net-zero targets are just paying lip service to real climate action. That’s the key reason we think Glasgow at this stage has a very big credibility gap.”

Climate finance: the pact “notes with concern that the current provision of climate finance for adaptation remains insufficient to respond to worsening climate change impacts in developing country Parties.” There is no funding target mentioned.

Coal target was watered down at the last-minute to a pledge to “phase down” rather than “phase out” coal power, but the inclusion is still significant as the first mention of coal in a COP text

Collin Rees, senior campaigner with nonprofit Oil Change Int’l: BOGA raises the bar for who can credibly claim the title of “climate leader.” “You see some of the countries with the biggest plans for extraction of fossil fuels, both currently and over the next decade, trying to claim to be climate leaders.”

Collin Rees, senior campaigner with nonprofit research group Oil Change International: “The industry is pushing to lock in this production, pushing to continue to extract oil and gas long beyond when we know that we can allow them to do that, ” he said. “That’s why this is such a big deal. This is the first time at the international level that that has been recognized — that not only do we have to address the consumption of fossil fuels, but we really do have to limit production as well.”

Collin Rees, senior campaigner with nonprofit research group Oil Change International: fossil fuel industry is trying to lock in demand by exploring for new reserves and building new infrastructure like pipelines and export terminals.

Companies were eager to show their support in Glasgow, with countless industry booths and appearances by corporate elites like Microsoft Corp. co-founder Bill Gates and BlackRock Inc. Chief Executive Officer Larry Fink.

Concerns about integrity of new carbon market system: Carbon Market Watch called it a “travesty” that will dilute the positive impact.

COP26 is over. And we are now on track for global heating that exceeds 2oC. At this temperature, up to 99% of coral reefs will die. Are we comfortable with this truth.

COP26 president Alok Sharma’s apology goes to the heart of the goals of COP26, that it would deliver outcomes matching the urgent “code red” action needed

COP26 will be seen as an inflection point for global climate recovery.

Countries will have to take a detailed inventory of their greenhouse gas emissions by 2024, which will be used as the basis for future emissions cuts.

Developing countries want international climate adaptation finance to roughly double from 2019 levels to about $40 billion by 2025.

Dirk Forrister, IETA CEO: Article 6 agreement “establishes an integrity framework to support the expansion of carbon markets to help governments and businesses deliver higher climate ambitions.”

Domestic politics rather than international pressure is often the force driving climate policy. So there are no guarantees nations will deliver greater ambition in 2022.

ELM can help bound carbon prices

Excessive and unrealistic expectations risk a response that says it's not worth trying. This would be a disaster. This is why the multiple supporting agreements achieved at Glasgow on methane, forestry, finance and carbon markets, were a major success. These commitments need to be delivered but together they keep us moving forward.

Forms of effective carbon pricing

Frances Seymour, WRI: “It’s great that forests were given a big place on the stage at Glasgow, that they had a head of state level segment on forest ... When you look back over the past few decades of climate action, forests had been the Cinderella neglected step sister.”

Frances Seymour, WRI: “Many of us who’ve been in this business for several decades have seen this movie again and again and again, and the ending never changes. Pledges are made and then nothing happens.”

George Monbiot: And instead they’re giving us this pathetic, limp rag of a document. Demonstrating they are here not to protect life on Earth, but to protect the fossil fuel industry from challenge.

George Monbiot: The Glasgow Climate Pact, for all its restrained and diplomatic language, looks like a suicide pact. After so many squandered years of denial, distraction and delay, it’s too late for incremental change.

George Monbiot: What a total fiasco it is. This is getting very close to the last possible chance, and instead of the sweeping change which we need, like leaving all fossil fuels in the ground by 2030, not even on the table, not a prospect.

Global temperature likely to exceed 2oC under even most optimistic scenario

Global Witness found that 503 people with links to fossil fuel interests had been accredited for the climate summit.

Greta Thunberg on Twitter: “The #COP26 is over. Here’s a brief summary: Blah, blah, blah. But the real work continues outside these halls. And we will never give up, ever.”

If targets under international law, with a much more universal commitment, have not been met, what are the chances that a non-legally binding commitment (which the Glasgow Declaration is) will be?

Inger Anderson, exec dir UNEP: “It is not good to see that net-zero pledges are generally vague and untransparent; they are hard to calculate and hold to account; many kick the can beyond 2030, when we know that we need to halve our emissions between now and 2030 to be on track to limit warming to 1.5C.”

Inger Anderson, exec dir UNEP: these new near-term commitments are, “frankly, an elephant giving birth to a mouse”.

James Thornton ClientEarth CEO on overall summit issues: “Negotiations have failed to secure an agreement to end coal or ‘wind down’ the use of oil and gas. Countries in the Global South that have done little to exacerbate global warming are not seeing the $100 billion per year in climate financing that was promised previously. And serious doubt remains over whether limiting warming to 1.5C – the key metric for survival for many climate vulnerable communities – can be achieved.”

James Thornton ClientEarth CEO: “new regular reporting may help citizens compare and analyse countries’ short and long term greenhouse gas reductions plans, which will help people hold governments to account on their commitments.”

James Thornton, ClientEarth CEO on deforestation: “For it to translate into action, this commitment needs teeth. It must address how deforestation is defined and measured, set binding milestones, address financing issues, and ensure participation and protections for local communities and Indigenous peoples. To ensure countries live up to their promises, transparent and robust monitoring is essential.”

James Thornton, ClientEarth CEO on loss and damage: “Climate change is inherently unequal: its impacts – such as droughts, heatwaves flooding, and rising seas – are felt most in those countries least responsible. This is clearly a human rights issue, and robust international efforts are needed to ensure peoples’ futures are protected. When governments do not take action, litigation will increasingly be used to hold them accountable.”

James Thornton, ClientEarth CEO on loss and damage: “This year’s agreement includes establishing a facility to support technical assistance on loss and damage from climate change in developing countries. But this is far from providing financial support to compensate for loss and damage, which the coalition of least developed countries was pushing for.”

James Thornton, ClientEarth CEO on the overall summit: “The push for pre-2030 action, including a new annual high level Ministerial meeting from 2022, will further highlight governments that are delaying action. Finally, the recognition of the role of Indigenous peoples and youth in climate action is also a first and could provide momentum to legal cases that challenge governments over their failures.”

James Thornton, ClientEarth CEO: “Coal should already be consigned to history, and the agreement should have gone much further – with explicit commitments to also move away from oil and gas. Instead, we are left with a weak reference to removing ‘inefficient subsidies for fossil fuels’.

James Thornton, ClientEarth CEO: “On emissions reductions, we’re still not moving in the right direction. Promises to reach the goals of the Paris Agreement are meaningless if they do not result in emissions reductions in the short-term. Governments should establish short-term plans and targets, and back those up with strong regulation and enforcement.”

Jane Francis: The polar regions are no longer an early warning signal for climate change ... Instead, they are now a driver of climate change

Jason Box: The lack of a science-based response is alarming

Jochen Flasbarth, headed of Germany’s COP26 delegation: the joint U.S.-China agreement in Glasgow was the summit’s “high point.”

Joe Eisen, executive director of Rainforest Foundation UK: “REDD has proved to be pretty ineffective over the past 14 years, and without reviewing the reasons why it’s been ineffective, all of a sudden we’re seeing a huge upscaling through LEAF ... And there’s serious concerns about its viability and how it might incentivize state capture of land.”

John Kerry: “Not only are companies ahead of government, but companies understand that their future is tied to having a stable marketplace.”

Kelley Kizzier, VP for global climate EDF: "The agreed Article 6 rules give countries the tools they need for environmental integrity, to avoid double counting and ultimately to clear a path to get private capital flowing to developing countries.”

Kelley Kizzier, VP global climate EDF: :This COP will be remembered as the Methane Moment — the year this long-overlooked climate pollutant finally received the attention it requires.”

Kelley Kizzier, VP global climate EDF: "The decision eliminates double counting for compliance markets and establishes a strong framework to ensure appropriate accounting for voluntary carbon markets that also supports emissions reductions in countries hosting carbon market activities.”

Kelley Kizzier, VP global climate EDF: “A COP26 signal to phase out coal and fossil fuels is significant, even if weaker than ideal.”

Kelley Kizzier, VP global climate EDF: “The sum of COP26 went beyond the two weeks in Glasgow. The COP drove critical announcements long before delegates were on the ground.”

Kelley Kizzier, VP global climate EDF: “Today’s agreement on Article 6 provides the rules necessary for a robust, transparent and accountable carbon market to promote more and faster climate ambition and create a further avenue for finance flows from developed to developing countries.”

Kelley Kizzier, VP global climate EDF: The Glasgow pact “eliminates double counting for compliance markets and establishes a strong framework to ensure appropriate accounting for voluntary carbon markets that also supports emission reductions in countries hosting carbon market activities.”

Key COP26 achievements

Key topics like setting up a system to pay for damages wrought by climate change were still unsettled

Lars Koch, policy director at ActionAid Denmark re oil-producing countries and Beyond Oil and Gas Alliance: “If they don’t become members of this alliance, what they are actually saying is, ‘We don’t mean what we say about 1.5, ’” he said. “It is just pure, deep greenwashing.”

Lars Koch, policy director at ActionAir Denmark: “BOGA will need to recognize the need for wealthy, economically diversified countries to phase out oil and gas production more rapidly than others.”

Laurent Donceel, senior policy director at the Airlines for Europe industry association: The Glasgow pact will make the CORSIA program stricter. “This is a significant clarification in the business decision-making of airlines ... It will influence their investments in sustainable aviation fuels and their fleet renewal.”

Leaders can force the changes they could not make in Glasgow. Because most climate actions devolve to lower tiers of government, mayors, local authorities, counties and states can be enabled to slash transport and building emissions and help households.

Loss and damage: pact urges developed countries to provide support, but no funding mechanism in place and contributions are voluntary

Making matters worse, “Biden’s climate and social spending plan, ” the Times noted, “does not eliminate subsidies for fossil fuels.” Those subsides total about $20 billion per year. So we ordinary folk pay oil big-shots to set our atmosphere on fire. Biden won’t fix that. Period. How about them apples?

Meanwhile at the Glasgow climate summit, Biden opened by claiming the U.S. would keep its promise to slash greenhouse emissions by more than half by the end of the decade. Does he know something we don’t? ‘Cause by the end of the decade a Trump clone will likely have been in power. Unless the Dems can thwart the Cro-Magnon GOP base, Biden’s promises aren’t worth the paper they’re written on.

More of the bla bla bla we know very well. Same/similar pledges from governments and corporates going on for more than a decade to halt deforestation in 2020 (ohh missed!), 2025 (ohh we will missed it), 2030… (we will certainly miss it). How can we achieve something we are consistently missing by using the same methods: press releases…!