Carbon pricing: the general trend of future climate action

one? Countries and regions are making progress

So far, more than 40 countries and 24 areas under national jurisdiction have implemented or plan to implement carbon pricing. These carbon pricing schemes cover 7 Gt CO2e of greenhouse gas emissions, accounting for about 13 per cent of global greenhouse gas emissions each year. About 2x3 have implemented a cap-and-trade scheme for emissions, and about 1x3 have implemented a carbon tax on emissions; about 1Accord 4's jurisdiction has implemented cap-and-trade schemes and carbon taxes for carbon pricing.

Some new or expanded pricing plans have been launched in the past few years. In 2015, Portugal introduced a carbon tax and South Korea implemented a cap-and-trade scheme. California's cap-and-trade program, launched in 2012, expanded to cover 85% of the state's greenhouse gas emissions.

After abolishing carbon prices in 2014, Australia launched a new "safeguard mechanism" in 2016-an improved version of cap-and-trade. In addition to the carbon tax that has been in place since 2008, British Columbia imposed restrictions and pricing on pollution from industrial facilities, particularly for coal-fired power plants and liquefied natural gas facilities, in 2016; it plans to expand its carbon tax in 2018 to include fugitive emissions and deforestation heap incineration, and to increase the carbon tax by $5 a year.

In 2017, Ontario, Canada implemented a cap-and-trade scheme, and Alberta introduced a new carbon tax on transport and heating fuel emissions. Canada's federal experiment on carbon pricing has been successful: four different plans are under way in four different provinces, and the federal government is preparing to implement national carbon prices in 2018. But federal requirements leave enough room for provinces to customize their own solutions. Mexico will also introduce a national carbon price in 2018.

Chile has implemented a carbon tax since 2014 and will take effect in 2017. South Africa is expected to introduce a carbon tax in 2017, but its implementation has been delayed. China plans to introduce a much-anticipated national carbon price in July 2017. Although nine regions in China have implemented cap-and-trade schemes for a certain year, their national plans will double the world's carbon emissions with price tags. Starting in July, more than 4% of global emissions will be priced.

2? the Paris Agreement provides the possibility for international carbon pricing.

In December 2015, 195 countries unanimously adopted the historic Paris Agreement to limit global warming. Article 6 of the Paris Agreement lays the foundation for the international carbon pricing system. Signatories are in the process of drawing up plans and many countries are already taking action. Nearly 100 countries, which account for 58 per cent of global greenhouse gas emissions, have submitted preliminary plans to declare interest in international carbon pricing to help them meet their respective emission reduction targets. Some countries have implemented domestic or regional carbon prices. The implemented carbon price has a market capitalization of about $50 billion in 2016, and international actions coordinated by the Paris Agreement could bring new sources of revenue to participating countries in the coming years. By adding the international carbon pricing scheme to the current progress, carbon prices could soon affect most parts of the world, covering the global emissions of 2GP3.

three? North America is keen on carbon dividends

National and local governments use carbon pricing revenues to reduce other taxes, fund clean energy projects and close budget gaps. Some jurisdictions return some of their income to the people. The idea of a carbon dividend, which is paid by polluters and returned to the public, is making progress in North America.

People all have ownership of the natural resources on the earth. The carbon tax in Alberta, Canada, includes a small rebate, and the federal plan will return some of the money to individuals. For nearly a decade, British Columbia has returned carbon tax revenue to the public in the form of an income tax credit-not as transparent as dividend checks, but with a similar idea. At present, British Columbia plans to increase and expand taxes and use new income to provide rebate cheques to ensure that most local residents are better off.

California's cap-and-trade program always includes dividends reflected on everyone's bills in the form of "climate credit". But dividends are at the heart of a new proposal to revolutionize the state's cap-and-trade program. 50% to 90% of the income will be returned directly to individuals, so everyone in California receives a check by mail every quarter. Even if oil companies worry that the price of carbon will become too high, ordinary people will be happy because they will receive more checks. Californians hope that the carbon dividend will bridge the divisions between parties that have shown signs of hindering American progress. Advocates in Washington, D.C., are also pushing for carbon costs and rebates.

four? The United States retreats and the world moves forward

In June, US President Donald Trump announced that he would withdraw from the agreement. The United States pointed a loaded pistol at its own foot, and President Trump pulled the trigger. But the rest of the world is pushing ahead with carbon pricing and taking the lead in the clean energy economy race. Countries and regions continue to promote carbon pricing. Canada and Mexico will implement national carbon pricing plans in 2018, while the European Union and China are forming an alliance to become global leaders in the transformation of a low-carbon economy. At the same time, the United States lags behind. But the pioneering climate action in California is laying a good foundation for American action.

Source: "Climate change Science dynamic Monitoring KuaiBao", No. 13, 2017, Lanzhou Literature and Information Center, Chinese Academy of Sciences. Please indicate the source.

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