Report calling for a drastic increase of carbon price to limit climate change
A report from the two well-known economists Joseph Stiglitz and Nicholas Stern, asking for an increase price of the CO2 tonne, has just been published. Conducted as part of a Coalition for the pricing of carbon (CPLC) supported by France and the World Bank, the authors, highlight the fact that a price between 40 and 80 dollars per tonne in 2020 and between 50 and 100 dollars in 2030 is the only way to respect Paris Agreement’s target of a 1,5˙C increase of temperature by the end of the century.
With a price inferior to 6 dollars today in Europe, the price for the CO2 tonne is far from fostering behaviours’ change in investments, production and consumption as it was supposed to do. Because of this failure of the EU ETS to reach a minimum price for carbon, we should need to establish a carbon price floor as a matter of urgency. Besides, the report recalls that 87% of global emissions are still today not covered by the carbon system. Against that background, only significant higher carbon price could create changes in the industrial architecture without hampering growth and job creation.
However, the only pricing of carbon would not be sufficient to reduce carbon emissions at a pace that enables the limitation of degrees increase at a level compatible with the Paris Agreement. A combination of instruments would be thus necessary: investment in the public transports, subsidies to the renewable energy production, phase out of fossil fuels etc…
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