The 2021 edition of the annual State and Trends of Carbon Pricing report was launched at Innovate4Climate today. Climate Focus is proud to have worked with experts from the World Bank team to put together this comprehensive update on the latest carbon pricing developments around the world.
Some key takeaways:
- There are early signs of more ambitious carbon pricing instruments being adopted by governments, but carbon prices continue to be far lower than they need to be to meet the goals of the Paris Agreement.
- The majority of countries have not yet aligned their carbon prices with their long-term net zero goals, with the most forward-looking governments only setting out how their policies will develop up to 2030.
- Net-zero and other corporate climate commitments are driving increasing carbon market activity, but there is consensus emerging that carbon crediting should play a supplementary role to own emissions reductions in corporate climate strategies.
- Nearly half of the largest 500 companies in the world by market value already have an internal carbon price or intend to adopt one in the coming two years. The majority of these fall short of Paris Agreement aligned prices, though often exceed regulatory prices.