Global carbon market increases by 56% in one year, says World Bank

The global value of carbon pricing schemes are now estimated to be worth $82 billion, according to a new report from the World Bank.

The figure for 2017 represents a 56 percent increase on the $52 billion in the previous year, following the opening of new markets, including China.

The report, launched today, finds that there are currently 51 carbon pricing initiatives around the world, consisting of 25 emissions trading schemes and 26 carbon taxes. These initiatives cover 20 percent of all global greenhouse gas emissions, or 11 gigatonnes of carbon dioxide equivalent.

The schemes have been put in place across 71 jurisdictions, 45 of which are on the national level as governments increasingly see the economic benefits of curbing emissions. The World Bank estimates that receipts from carbon pricing now amount to $33 billion, also a 50 percent increase on the previous year.

Along with China’s planned regulation of its power sector, new carbon programmes were rolled-out in Chile, Colombia, and the Canadian provinces of Alberta and Ontario.

The European Union also took steps to fix its dysfunctional trading scheme by increasing the price from 5 euros per tonne of CO2 equivalent to 13 euros ($7 to $16).

However, analysts from the World Bank point out that this remains below the accepted range of $40-$80 per tonne needed to reach the goals of the Paris climate agreement.

 “Governments at all levels are starting to see the effectiveness of carbon pricing in their efforts to cut harmful carbon pollution while also raising revenues for climate and other policies, including environmental action,” said John Roome, World Bank Senior Director for Climate Change. “As countries take stock of their Paris Agreement commitments and set a path towards increased ambition, carbon pricing mechanisms with robust pricing levels are proving to be essential elements of the toolkit.”

Looking forward, Singapore and Argentina also plan to implement carbon taxes in 2019.