More Companies Than Ever Are Including Carbon Pricing In Their Business Plans
CDP recently released a report that looked at trends in carbon pricing, and they found that more than ever before, companies are putting a price on their own emissions.
This report comes on the heels of the announcement that the EPA is pulling out of the Clean Power Plan.
The new CDP report shows that there has been an eight-fold increase in the number of companies applying a monetary value to their emissions into their business plans in the last four years, including big name companies like National Grid, Exelon Corporation, and PG&E Corporation.
Regions and countries recording a rise in carbon pricing include:
- US: 96 US-based companies disclosing they are now using an internal carbon price, up from 29 in 2014, with an additional 142 planning to implement one by 2019
- China: the number of companies internalizing a carbon price nearly doubling from 54 to 102 since 2015
- Canada: Since the government introduced regional carbon pricing systems, Ontario will see US$1.5 billion in clean investments enabling Canada to reach its 2030 climate goal
- Latin America: Chile, Columbia, Mexico and Peru committed to a green growth strategy and a carbon emissions market for the region in the future;
- Korea: South Korea already operates the first national Emissions Trading System in Asia and has recently published plans to tighten its system.
According to Paul Simpson, CEO of CDP: “Carbon pricing makes the invisible, visible. We’re seeing a significant rise over last year in the use of companies pricing their own carbon pollution in China, Mexico, Japan, Canada and the US. Changing regulation is working on a global scale and in all regions we are seeing many businesses fast track the low carbon transition into their business plans.”
Some of the other highlights of the CDP report include:
Exponential growth in carbon pricing market: After 4 years of growth, the report says that internal carbon pricing is now “a global phenomenon.” The report explains that this is an “important mechanism to help companies manage risks and capitalize on emerging opportunities in the transition to a low-carbon economy,” and more companies than ever are taking on this task.
Growth of Companies Reporting: The number of companies reporting their internal carbon price was just 150 in 2014, but this number has grown to more than 1,300 companies in 2017. Many of these companies are Fortune Global 500 companies.
Companies use internal carbon pricing for differing needs: Some companies use this pricing to help determine future financial risks, to plan for investment, to reveal hidden opportunities for growth, or to as a transition tool, to “accelerate reduction of GHG emissions; drive investment in energy efficiency initiatives, renewable energy procurement, and R&D of low-carbon products/services.”
You can see the full CDP report online here, which covers the growth of carbon pricing over the past year, tips and tools for best practices, examples from companies that have put carbon pricing into action, and business applications for carbon pricing.
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