How carbon pricing is advancing

Many fear that America’s withdrawal from the Paris climate agreement will undermine the international consensus to reduce greenhouse-gas emissions.

- Adair Turner

Yet just in the last month, there have been two major steps toward widespread carbon pricing where it is needed most. To be sure, carbon pricing is not always the best policy, and not all sectors need to be subjected to schemes that require international consistency. If India electrifies its vehicle fleet more slowly than Europe, European industry suffers no competitive disadvantage. But the situation is different in long-distance shipping and aviation, and in heavy industries such as steel and chemicals, which account for around 25% of global emissions, Here, carbon pricing is key to cost-efficient decarbonization, and must be imposed on an internationally consistent basis.