A new report released by the World Bank Group revealed that the value of various global carbon pricing instruments stands at $48 billion in 2015. And this is expected to grow more quickly unless the world learns to decarbonize, the United Nations’ top climate change official said.
The World Bank and Ecofys’s new Carbon Pricing Watch involves 40 countries and over 20 cities, states and regions planning to utilize a price on carbon in order to help decrease greenhouse gas emissions. On a much detailed breakdown, the study said the $48 billion was a combined value of $34 billion for emissions trading systems, and $14 billion for countries with carbon taxation systems.
It noted the $34 billion figure for carbon markets was an uptick from the $32 billion in 2014.
“Carbon pricing is clearly gaining traction,” said Rachel Kyte, WB Group vice president and special envoy for climate change.
The jump was due to the January launch of the South Korean emissions trading system, considered one of the world’s largest emissions trading systems, and the expansion of the California and Quebec cap-and-trade systems. Portugal and Mexico likewise implemented new carbon taxes in 2014.
The WB report revealed global businesses are now actively supporting carbon pricing measures being laid down by governments, compared to previous years when their foremost question was to price carbon at all. The report mentioned leaders now look to the WB and others for technical advice as they determine how to put carbon pricing into operation.
“Now, everybody is around the table working on developing the most economically effective solutions to deal with climate change. They understand the risks of failing to take action,” Kyte said.
The European Union, through German Chancellor Angela Merkel and French President François Hollande, has called for an international use of carbon pricing. Their joint call for action mentioned “introducing carbon markets and pricing on national and regional level with the aim of giving strong economic incentives for low-carbon transformation.”
Christiana Figueres, the United Nations’ top climate change official, in a carbon market conference in Barcelona, urged on global governments to continue tackling what needs to be done to tackle the growing climate change “because frankly we don’t have any other option.”
“A decarbonized world is now irreversible, irrefutable,” Figueres said.