An unprecedented alliance of heads of state, city, and state leaders, has called for countries and companies around the world to put a price on carbon.
The call comes by way of the Carbon Pricing Panel, a group of leaders from around the world convened by World Bank Group President Jim Yong Kim and IMF Managing Director Christine Lagarde, in conjunction with OECD Secretary General Angel Gurria. In all, the Carbon Pricing Panel is made up of German Chancellor Angela Merkel, Chilean President Michelle Bachelet, French President François Hollande, Ethiopian Prime Minister Hailemariam Desalegn, Philippines President Benigno Aquino III, Mexican President Enrique Peña Nieto, Governor Jerry Brown of California, and Mayor Eduardo Paes of Rio de Janeiro.
“There has never been a global movement to put a price on carbon at this level and with this degree of unison,” said World Bank Group President Jim Yong Kim.
“It marks a turning point from the debate on the economic systems needed for low carbon growth to the implementation of policies and pricing mechanisms to deliver jobs, clean growth and prosperity. The science is clear, the economics compelling and we now see political leadership emerging to take green investment to scale at a speed commensurate with the climate challenge.”
In under a month, world leaders will be meeting in Paris for the UN climate negotiations, and this new challenge from some of those who will be in attendance — including host nation President François Hollande and the ever-formidable Angela Merkel — is sure to be a topic of discussion. The group are calling on their country, state, and city counterparts from around the world “to join them in pricing carbon to steer the global economy towards a low carbon, productive, competitive future without the dangerous levels of carbon pollution driving warning.”
There are already 40 nations and 23 cities, states, and regions around the world that have implemented or are in the process of implementing a price on carbon, with a variety of programs and policy mechanisms covering approximately 12% of global greenhouse gas emissions.
“Finance ministers need to think about reforms to fiscal systems in order to raise more revenue from taxes on carbon-intensive fuels and less revenue from other taxes that are detrimental to economic performance, such as taxes on labor and capital,” said Christine Lagarde, Managing Director of the International Monetary Fund. “They need to evaluate the carbon tax rates that will help them meet their mitigation pledges for Paris and accompanying measures to help low-income households vulnerable to higher energy prices.”
The panel are also wielding a significant amount of private sector support, with institutions such as US institutional investor CalPERS, ENGIE of France, Mahindra Group of India, and Netherlands-based Royal DSM backing the call, and which will help link business needs with public policies through the Carbon Pricing Leadership Coalition, an action based platform that will be officially launched in Paris on November 30, 2015.
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