A newly announced partnership between Al Gore’s Generation Investment Management and Ecofys aims to investigate how carbon pricing can contribute to global sustainable economic growth.
Announced on Tuesday, Ecofys revealed that it had partnered with The Generation Foundation, the advocacy initiative of Generation Investment Management, which itself was co-founded by Al Gore and David Blood in 2004. The aim of the partnership is “to investigate how carbon pricing can facilitate sustainable global economic growth.” The partnership will focus on three years of research, tackling the idea of carbon pricing “from a new angle,” namely, “exploring the role of carbon pricing along value chains up to the end consumers.” Ecofys said that the partnership “quantified insights into the role carbon pricing can play in achieving the goal of a 1.5°C future.”
“The proposed research aims to deliver actionable results and solutions for these challenges,” added Kornelis Blok, Director of Science of Ecofys and Professor at TU Delft. “With our innovative approach, we will take a comprehensive look at the issues, encompassing the policy, industry, investor and civil society perspective.”
Carbon pricing, or as it’s often described by opponents, carbon taxing, is a hot-button issue around the world. A number of countries are turning towards carbon pricing, but there are as many opponents as there are supporters. One need only look at Australia’s history with carbon pricing to see that it is not a simple issue. Ecofys explains further:
World leaders and businesses are increasingly embracing carbon pricing as a key instrument in the transition towards a low carbon economy. However, despite the uptake in carbon pricing, harmonization of policies across different regions remains tenuous. Furthermore, carbon prices are often too low to incentivize the investment necessary to decarbonize emissions-intensive value chains. At the end-consumer level, the impact of carbon pricing is often insufficient to drive changes towards more low carbon consumption.
“Carbon remains a largely unpriced externality in today’s financial markets,” explained David Blood, Senior Partner of Generation Investment Management. “Although it is impossible to know the exact timing of the prospective tipping point when financial markets will fully internalise carbon risk, it is critical for investors to prepare for its inevitable impact.”