1、carbonpricingSTATE AND TRENDS OF2024WORLDBANK.ORG2 State and Trends of Carbon Pricing 2024 2024 International Bank for Reconstruction and Development/The World Bank1818 H Street NW,Washington,DC 20433 Telephone:202-473-1000 Internet:www.worldbank.orgSome rights reserved.1 2 3 4 27 26 25 24This work

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7、ion Please cite the work as follows:World Bank.2024.State and Trends of Carbon Pricing 2024.Washington,DC:World Bank.DOI:10.1596/978-1-4648-2127-1.License:Creative Commons Attribution CC BY 3.0 IGO.Translations If you create a translation of this work,please add the following disclaimer along with t

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11、ts solely with you.If you wish to reuse a component of the work,it is your responsibility to determine whether permission is needed for that re-use and to obtain permission from the copyright owner.Examples of components can include,but are not limited to,tables,figures,or images.All queries on righ

12、ts and licenses should be addressed to World Bank Publications,The World Bank,1818 H Street NW,Washington,DC 20433,USA;email:pubrightsworldbank.org.ISBN(electronic):978-1-4648-2127-1 DOI:10.1596/978-1-4648-2127-1Design:Simpelplus(www.simpelplus.de)Cover design:Brad Amburn()Copyediting:EpsteinWordsAn

13、nexesChapter 4Chapter 3Chapter 2Chapter 1ForewordExecutive SummaryWORLDBANK.ORGThe development of this report was led by the World Bank and prepared by experts from the World Bank and adelphi.Contributions,including on data and information on emissions trading systems,were provided by the Internatio

14、nal Carbon Action Partnership.Additional data and contributions were also provided by Ecosystem Marketplace.Platts,S&P Global Commodity Insights,and the Institute for Climate Economics also supported development of this report.The World Bank task team responsible for this report was composed of Jose

15、ph Pryor,Ashia Bio Sawe,Alejandra Mazariegos,Adrian Constantin Gagu,Jichong Wu,Martin Laplane,Harikumar Gadde,Seoyi Kim,Shreya Rangarajan,Jacob Junghun Lee,Kathleen Patroni,Conrad Buffier,and Helen Guys.The adelphi team included Constanze Haug,David Hynes,Stephanie La Hoz Theuer,Victor Ortiz Rivera,

16、Santiago Ramrez Niembro,Lewis Stevens,and Theresa Wildgrube.Editorial support was provided by Leon Heckmann,Trevor Laroche-Theune,Anastasia Steinlein,and Hermia Tim Lan Chan.This report benefited greatly from the insights and contributions from Jess Abraham Bartolome Lasa;Alberta Environment and Pro

17、tected Areas;Andrs Camilo lvarez-Espinosa;Alexandra Andrea Maite Campmas;Aivi Aolaid-Aas;Veli Auvinen;Christopher Axelson;Charlotte Barber;Kristinn Bjarnason;Simon Black;Velda Buldas;Ciro Calderon;Diana Cardenas Monar;Daniel Clarke;the Clean Energy Regulator(Australia);Alana Clement;Climate Policy D

18、epartment(Ukraine);Angela Colquitt;Claude Ct;Julie Ct;Katherine Cox;Dan Dale;Danish Ministry of Taxation;Stefano De Clara;Department of Climate Change,Energy,the Environment and Water(Australia);Department of Finance Canada;Department of Finance,Government of the Northwest Territories;Direccin Nacio

19、nal de Investigaciones y Anlisis Fiscal de la Subsecretara de Ingresos Pblicos de la Secretara de Hacienda del Ministerio de Economa(Argentina);Joaqun Egaa Tamargo;Assia Elgouacem;Amanda Engel;Dominik Englert;Federal Office for the Environment-Climate Division(Switzerland);Cristina Figueroa Vargas;C

20、arolyn Fischer;Mathieu Fouquet;Nicolas Garceau;Alexandre Godzinski;Marlen Goerner;Rachel Gold;Jorge Gmez Lechaptois;Denitza Gonzalez;the Government of New Brunswick;Stephane Hallegatte;Lotta Hambrecht;Haley Hamza;Insa Handschuch;Andrew Hayes;Sharlin Hemraj;Kolsaker Hjalmar Richter;Livia Hollins;Ruri

21、k Holmberg;David Hynes;Heeweon Hyun;Karin Jehle;Katie Keegan;Jussi Kiviluoto;Jessica Knowler;Nicolas Krakovitch;Younghyun Lee;William LHeud;Shelby Livingston;Luca Lo Re;Macroeconomic and Finance Advisory,Ministry of Economy and Finance(Uruguay);Bosi Martina;Mark Mateo;MXICO2;Ministry of Economy,Trad

22、e and Industry(Japan);Ministry of Energy(Hungary);Ministry of the Environment and the J-credit system secretariat(Japan);Ministry of Finance(Hungary);Mariza Montes de Oca Leon;Yuliia Morozova;Marco Murcia;Kuhle Mxakaza;Nives Nared;National Center on Climate Change Strategy and International Cooperat

23、ion(China);National Climate Change Secretariat and National Environment Agency(Singapore);Derek Nixon;Klaus Oppermann;Yongchul Park;Eduardo Piquero;Alex Procton;Anasuya Raj;Laura Remmelgas;Kim Ricard;Angela Liliana Rodrguez;Clment Roman;Rajinder Sahota;Gabriel Saive;Rico Salgmann;Hugh Salway;Monique

24、 Schafer;Juan Pedro Searle;Stephen Shelby;Kay Shirey;Mark Sippola;Jacob Smith;Teresa Solozbal Gallego;William Space;Sandhya Srinivasan;Lewis Stallard;Camille Sultana;Erin Szelagowski;Emma Tauti;Tax Advisory,Ministry of Economy and Finance(Uruguay);Thailand Greenhouse Gas Management Organization;Kons

25、tantinos Theodoropoulos;Maria Tome;Dharini Umapathy;Isabella Villanueva;Carlos Villasenor;Laura Weatherer;Klas Wetterberg;Jordan Wildish;Karlygash Zhunussova;and Mourad Ziani.Report design was done by Simpelplus and editing was done by EpsteinWords.This report has been developed as part of the Techn

26、ical Work Program under the Partnership for Market Implementation.3 State and Trends of Carbon Pricing 2024AnnexesChapter 4Chapter 3Chapter 2Chapter 1ForewordExecutive SummaryWORLDBANK.ORGTable of Contents4 State and Trends of Carbon Pricing 2024AnnexesChapter 4Chapter 3Chapter 2Chapter 1ForewordExe

27、cutive SummaryIntroduction 12CHAPTER 1 9EXECUTIVE SUMMARY 7FOREWORDCarbon taxes and emissions trading systems 18CHAPTER 2Carbon crediting markets and mechanisms 35CHAPTER 3Conclusion 57CHAPTER 4Annex ADefinitions60Annex BMethodologies andSources65ANNEXES 68ENDNOTESWORLDBANK.ORGList of FiguresFIGURE

28、18 Potential issuances from 2021-2025 activities that requested transition by host country and project type 44FIGURE 19 Indicative allocation of retirements by host country to major markets in 2023 46FIGURE 20 Exchange-traded(ET)prices from April 2021 to 1 April 2024 and comparisons between yearly a

29、verage of ET and over-the-counter prices(OTC)49FIGURE 21 How the Emission Reduction-Linked Bond works 54List of BoxesBOX 1 Looking beyond direct carbon pricing 15BOX 2 Understanding carbon credit markets 38BOX 3 Tracking purpose of retirement 46BOX 4 Integrating emission reduction and removals into

30、innovative financial instruments 53List of TablesTABLE 1 Key carbon pricing developments at the subnational level in the past year 205 State and Trends of Carbon Pricing 2024FIGURE 1 Pricing policy ecosystem and report scope 14FIGURE 2 Global total carbon price for the period 2015-2021(USD 2023)16FI

31、GURE 3 ETS and carbon tax uptake by countries income group over time (2005-2024)19FIGURE 4 Map of carbon taxes and ETSs 21FIGURE 5 Global GHG emissions covered by ETSs and carbon taxes 22FIGURE 6 Indicative estimates of the potential GHG emissions covered by different carbon pricing instruments and

32、international initiatives 24FIGURE 7 Prices and coverage across ETSs and carbon taxes,as of April 1,2024 25FIGURE 8 Nominal prices in the largest ETSs and carbon taxes in operation 27FIGURE 9 Evolution of global revenues over time 29FIGURE 10 Revenue usage from carbon taxes and ETSs in 2022 30FIGURE

33、 11 Covered sectors in implemented ETSs and carbon taxes 32FIGURE 12 Carbon credit use in ETSs and carbon taxes 33FIGURE 13 Map of governmental crediting mechanisms 37FIGURE 14 Types of carbon crediting mechanisms and market segments 39FIGURE 15 Issuances and retirements by project category in indep

34、endent crediting mechanisms,2018-2023 41FIGURE 16 Annual registrations by crediting mechanism type from 2018 to 2023 42FIGURE 17 Share of annual registrations by project category in independent mechanisms from 2018 to 2023 43AnnexesChapter 4Chapter 3Chapter 2Chapter 1ForewordExecutive SummaryWORLDBA

35、NK.ORGACCU Australia Carbon Credit UnitBP British PetroleumCBAM The EUs Carbon Border Adjustment Mechanism CCPs Core Carbon PrinciplesCDM Clean Development Mechanism CERs Certified Emission Reductions CFTC Commodity Futures Trading Commission CO2e Carbon dioxide equivalentCOP28 28th annual Conferenc

36、e of the Parties of the United Nations Framework Convention on Climate ChangeCORSIA Carbon Offsetting and Reduction Scheme for International Aviation EMDEs Emerging market and developing economiesETS Emissions trading systemsFCPF Forest Carbon Partnership Facility GHG Greenhouse gas emissionsI4CE In

37、stitute for Climate EconomicsICAO International Civil Aviation OrganizationiCRAFT Innovative Carbon Resource Application for Energy Transition Project for UzbekistanICVCM Integrity Council for the Voluntary Carbon MarketIETA International Emissions Trading AssociationIMF International Monetary Fund

38、IMO International Maritime Organization IPCC The Intergovernmental Panel on Climate ChangeISDA International Swaps and Derivatives AssociationITMO Internationally Transferred Mitigation Outcomes LoAs Letters of AuthorizationMtCO2e Metric tons of carbon dioxide equivalent NDCs Nationally determined c

39、ontributions under the Paris AgreementnECR Net effective carbon ratesOBPS Output-Based Pricing System OECD Organisation for Economic Co-operation and Development OTC Over-the-counterPoAs Programmes of ActivitiesREDD+Reducing Emissions from Deforestation and Forest DegradationRGGI Regional Greenhouse

40、 Gas Initiative SBTi Science Based Targets initiative tCO2e Tons of carbon dioxide equivalent TCP Total carbon price T-VER Thailand Voluntary Emission Reduction Scheme UNFCCC United Nations Framework Convention on Climate ChangeUNIDROIT Unification of Private LawUSD United States dollarVAT Value-add

41、ed tax VCMI Voluntary Carbon Markets Integrity InitiativeVCS Verified Carbon StandardAbbreviations and acronyms6 State and Trends of Carbon Pricing 2024AnnexesChapter 4Chapter 3Chapter 2Chapter 1ForewordExecutive SummaryWORLDBANK.ORGForewordCarbon pricing can be one of the most powerful tools availa

42、ble to policymakers to incentivize reducing emissions as part of an integrated policy mix.A decade ago,carbon pricing policies covered only 7%of global emissions.Today,nearly a quarter are covered by these instruments.There is some cause for optimism as carbon pricing and carbon markets continue to

43、evolve and grow,and as new schemes and instruments are introduced that led to revenues reaching a record$104 billion in 2023.Promisingly,most of the revenues raised went towards climate and nature-related programs.The total number of implemented instruments also went up:today,there are 75 national c

44、arbon pricing instruments in operation with recent efforts in Australia,Hungary,Slovenia,Taiwan,China,and sub-national schemes in Mexico.And these policies are also becoming increasingly adaptable to national contexts and new sectors.Large middle-income countries including Brazil,India,Chile,Colombi

45、a,and Trkiye are making notable progress towards implementing emissions trading schemes.While the power and industrial sectors still account for the bulk of carbon pricing coverage,there are also advances in other sectors,including international aviation,shipping,and waste.Countries such as China,Vi

46、etnam,Thailand and Singapore are also increasingly seeking complementarity between carbon pricing policies and carbon markets by including carbon crediting frameworks in their policy mixes.This approach can support domestic pricing instruments and help the carbon price signal reach uncovered sectors

47、.Despite the positive trends that are outlined in this years report,higher pricing and wider coverage are going to be essential to really unlock the potential of carbon pricing.This will require political commitment,stronger global frameworks,and initiatives to share best practices that can help dri

48、ve ambition.Time is not on our side as countries will need to move further,faster to decisively bend the emissions curve and safeguard a livable planet.The Annual State and Trends report provides objective and up-to-date information on key developments in carbon pricing,reflecting our efforts to bec

49、ome a world-class Knowledge Bank.It is part of our overall effort to support countries worldwide to understand and develop a full range of carbon pricing policies,including through our Partnership for Market Implementation program.I hope this years report,like its predecessors,will inform,influence

50、and incentivize governments,private sector partners,and civil society stakeholders to support policies that put a price on carbon and help decisively bend the emissions curve.Jennifer SaraGlobal Director,Climate Change Group,World Bank 7 State and Trends of Carbon Pricing 2024AnnexesChapter 4Chapter

51、 3Chapter 2Chapter 1Executive SummaryForewordExecutive SummaryWORLDBANK.ORGExecutive Summary9 State and Trends of Carbon Pricing 2024Carbon prices remain insufficient despite a decade of strong growth An implementation gap remains between countries commitments and implemented policies.Carbon pricing

52、 instruments cover around 24%of global emissions.Carbon taxes and emissions trading systems(ETSs)currently being considered could lift coverage to almost 30%,but this will require strong political commitment.While carbon tax rates showed slight increases,price changes within ETSs were mixed with ten

53、 systems experiencing price decreases over the past 12 months,including long-standing ETSs in the European Union,New Zealand,and the Republic of Korea.Price levels continue to fall short of the ambition needed to achieve the Paris Agreement goals.Carbon pricing adoption has been limited over the pas

54、t year,but there are promising signs of uptake in middle-income countries There are 75 carbon taxes and emissions trading schemes in operation worldwide.There was a net gain of two carbon pricing instruments over the past 12 months.Middle-income countries including Brazil,India,and Trkiye have made

55、progress towards carbon pricing implementation.Implementation also progressed at the subnational level,despite some setbacks.Progress was observed in sector-specific multilateral initiatives for international aviation and shipping.The European Union Carbon Border Adjustment Mechanism commenced,requi

56、ring importers of specified products to report embedded emissions.CO2Carbon pricing revenue reached new highs Carbon pricing revenues in 2023 exceeded USD 100 billion for the first time,driven by high prices in the EU and a temporary shift in some German ETS revenues from 2022 to 2023.ETSs continued

57、 to account for the bulk of carbon pricing revenues.Over half of the revenue collected was used to fund climate-and nature-related programs.Despite carbon pricing revenue reaching record highs,its contribution to countries national budgets remains low.AnnexesChapter 4Chapter 3Chapter 2Chapter 1Forew

58、ordExecutive SummaryWORLDBANK.ORG10 State and Trends of Carbon Pricing 2024Emerging flexible designs and approaches reflect the adaptability of carbon pricing to national circumstances Governments are increasingly using multiple carbon pricing instruments in parallel to expand coverage or price leve

59、ls.Carbon pricing is mostly applied in the power and industrial sectors,but is increasingly being considered in other sectors,such as maritime transport and waste.Governments continue to allow regulated entities to use carbon credits to offset carbon pricing liabilities,which can increase flexibilit

60、y,lower compliance costs,and extend the carbon price signal to uncovered sectors.Carbon pricing continues to offer benefits beyond mitigation,including as a fiscal tool.Carbon credit markets saw mixed movements Governments,particularly in middle-income countries,are increasingly including crediting

61、frameworks in their policy mix,with a view to supporting both compliance and voluntary markets.Credit issuances fell for the second consecutive year.Retirements remained substantially below issuances,generating a growing pool of non-retired credits in the market.Compliance demand is building but vol

62、untary demand continues to dominate.Prices declined across most project categories,except for carbon removal projects,signaling interest in this project category.Prices were more resilient in over-the-counter transactions,which allow buyers to pursue specific purchasing strategies.Credits with speci

63、fic attributessuch as co-benefits,corresponding adjustments,or recent vintagestraded at a premium,demonstrating the value these characteristics provide buyers.The subdued market and reduced confidence emphasize the importance of initiatives to rebuild integrity and credibility The integrity of carbo

64、n credits remains a critical area of concern for the market.On the supply side,the Integrity Council for the Voluntary Carbon Market has established a benchmark for credit quality,with the first tranche of approved credits expected in 2024.On the demand side,efforts have focused on the importance of

65、 reducing operational and value chain emissions and the potential role for carbon credits to address residual emissions.Development and implementation of Paris Agreement Article 6 continues,despite setbacks and delays.AnnexesChapter 4Chapter 3Chapter 2Chapter 1ForewordExecutive SummaryIntroductionCH

66、APTER 01WORLDBANK.ORGCHAPTER 1Introduction1.1 Rapid implementation of policies to reduce emissions is critical if the world is to achieve the Paris Agreement goalsClimate change mitigation remains as critical as ever,as global greenhouse gas emissions continue to increase.Temperatures continue their

67、 relentless climb,and 2023 was the hottest year on record.1 The latest data show that global emissions of greenhouse gases hit record highs in 2022,2 and the concentration of carbon dioxide(CO2)in the atmosphere hit its highest ever level.3 Our atmosphere,oceans,and biosphere are showing rapid and w

68、idespread changes,4 and climate-related severe weather eventsincluding heat waves and storms in Europe,hurricanes in the United States,and flooding across Asiabrought the dangers of climate change into sharp focus in 2023.While political commitment continues to build,more action to reduce emissions

69、is needed.Over 90%of the 195 parties to the Paris Agreement have adopted quantified emission reduction targets,5 and more than 95 countries have announced net zero pledges,covering over 85%of global,energy-related CO2 emissions.6 Collectively,if met,countries net zero targets could limit global warm

70、ing to around 2C above pre-industrial levels.7 In 2025 the parties to the Paris Agreement will submit new nationally determined contributions(NDCs)for 2035,and they are expected to reflect an increase in ambition.However,on the whole,countries mitigation policy instruments are insufficient to meet c

71、urrent NDCs.8 Policies currently in place are projected to result in global emissions in 2035 that are 36%higher than the level consistent with limiting warming to 2C,and 55%higher than the level consistent with limiting warming to 1.5C.9 Immediate and sustained focus on the implementation of new po

72、licies is vital.Carbon pricing instruments have a critical role to play in addressing this implementation gap,as they can incentivize change across economiespromoting decarbonization and improving efficiencyand can be adjusted to align with increasingly stringent targets over time.A subdued global e

73、conomic outlook makes for a challenging environment for economic reform.10 Restrained growth in advanced economies is expected to continue in 2024,while growth in emerging market and developing economies(EMDE)is split.EMDEs with solid fundamentals(e.g.,strong credit ratings and moderate debt)are set

74、 for growth close to pre-pandemic levels,but others face a more uncertain outlook.11 While the economic outlook is better than many anticipated following the COVID-19 pandemic and recent energy crisis,2024 is expected to be the third straight year of slowing global economic growth,following a sharp

75、decline in 2022.Inflation remains an issue around the world,in particular for low-and middle-income economies.12 Going forward,governments will face difficult choices about where to allocate resources.This includes balancing efforts to address short-term challenges that underpin public acceptance,li

76、ke cost of living and recession risks,and tackling pivotal long-term issues like climate change,poverty,and income inequality.Immediate and sustained focus on the implementation of new policies is vital.12 State and Trends of Carbon Pricing 2024AnnexesChapter 4Chapter 3Chapter 2ForewordExecutive Sum

77、maryChapter 1WORLDBANK.ORGCarbon pricing is a critical part of the policy mix needed to both meet the Paris Agreement goals and support low emissions growth.Global initiatives including the Global Carbon Pricing Challenge(initiated by Canada),the International Carbon Action Partnership,the Coalition

78、 of Finance Ministers for Climate Action,the World Trade Organization-led task force on carbon pricing,and the World Banks own Partnership for Market Implementation continue work to support international cooperation on the development and implementation of carbon pricing around the world.Major progr

79、ess on potential domestic emissions trading in Brazil and Trkiye occurred in 2023,and existing systems across Asia,North America,and Europe continue to operate,generating record levels of revenue during 2023 despite challenging economic conditions.Efforts to implement international carbon credit mar

80、kets under Article 6 of the Paris Agreement continue,despite COP28 not reaching decisions on these provisions.With this delay,it appears that voluntary demand will continue to drive carbon credit market activity.However,concerns about voluntary carbon market credibility and questions regarding the r

81、ole of the credits to support corporate action have dampened momentum.This has emphasized the importance of supply,demand,and market integrity and underscores the role of initiatives currently underway to restore trust and confidence in carbon credit markets.Governments progressed a range of climate

82、 mitigation policy approaches during 2023,but an implementation gap remains.Large,high-income economies looked to industrial policy reform to boost the green transformation.In the United States,the Inflation Reduction Act marked its first anniversary with announcements of USD 110 billion in new priv

83、ate sector clean energy manufacturing investments.13 Similarly,the EU is developing the Net Zero Industry Act to support the delivery of affordable,reliable,and sustainable energy.The full impact of these approaches will take time to be realized.Governments continue to support the decarbonization of

84、 vehicles and the power sector through phaseouts of internal combustion engines and limiting new fossil fuel power generation(including Colombia,Panama,and Moroccos announcements during 2023 to phase out coal).14 As of COP28,24 countries have set zero-emission vehicle standards and more governments

85、are adopting policies to deliver on these goals.In 2023,the EU adopted legislation requiring the sale of only zero-CO2 emission vehicles starting in 2035.15 The commencement of reporting obligations for the EUs Carbon Border Adjustment Mechanism(CBAM),which seeks to level the playing field on carbon

86、 pricing for emissions-intensive trade-exposed goods,also occurred in 2023.These developments come alongside positive trends in the deployment of renewable energy.Global capacity surged by about a fifth over 2023,16 and renewable generation including hydro electricity is expected to overtake coal as

87、 the worlds largest single source of electricity by early 2025.17 Notwithstanding these developments,it is clear that an implementation gap remains,which requires continued progress across the climate policy portfolio,including comprehensive carbon pricing.Carbon pricing is a critical part of the po

88、licy mix needed to both meet the Paris Agreement goals and support low emissions growth.13 State and Trends of Carbon Pricing 2024AnnexesChapter 4Chapter 3Chapter 2ForewordExecutive SummaryChapter 1WORLDBANK.ORG1.2 Scope of the State and Trends of Carbon Pricing reportThis report focuses on the dire

89、ct pricing of greenhouse gas emissions through carbon taxes,emissions trading systems,and carbon crediting mechanisms.Direct carbon pricing drives climate action by providing an incentive to reduce emissions.Figure 1 illustrates how these measures fit into the pricing policy ecosystem,and Box 1 high

90、lights the importance of understanding the price signal provided by indirect carbon pricing policies.This years report covers direct carbon pricing,with a focus on developments between April 2023 and April 2024.Chapter 2 of the report explores trends in carbon taxes and emissions trading systems aro

91、und the world.Chapter 3 analyzes carbon credit markets and mechanisms,and chapter 4 summarizes key takeaways from this report.*As highlighted in Box 2,carbon credits can be used for voluntary or compliance purposes.Figure 1 illustrates the interaction between carbon credit markets and domestic compl

92、iance markets(ETSs and carbon taxes)whereby carbon credits can be used to offset price liabilities.FIGURE 1Pricing policy ecosystem and report scope14 State and Trends of Carbon Pricing 2024Emissions tradingCarbon TaxDirect pricingCarbon pricingTechnology incentivesIndirect pricingFuel taxesOthersRe

93、ductions in fuel subsidiesCarbon credit markets*Pricing measuresFocus of the State and Trends of Carbon Pricing reportAnnexesChapter 4Chapter 3Chapter 2ForewordExecutive SummaryChapter 1WORLDBANK.ORGBOX 1Looking beyond direct carbon pricingBy incorporating social costs(i.e.,damage caused by greenhou

94、se gas GHG emissions)into economic decision-making,carbon pricing is a critical policy intervention that can help address climate change and provide broader environmental,fiscal,and social benefits.Pricing can be implemented through a range of instruments with a spectrum of policy designs to meet do

95、mestic objectives and circumstances.This report focuses on direct carbon pricing,particularly emissions trading systems(ETSs)and carbon taxes,which impose a cost expressed as a monetary unit per ton of carbon dioxide equivalent(tCO2e).Anchored by the polluter pays principle,which states that those r

96、esponsible for generating pollution should bear its costs,in direct carbon pricing the cost is reflected through the supply chain in the relative prices of products and services.While there is an advantage to pricing carbon consistently and directly in proportion to the GHG emissions generated by a

97、given product or activity,indirect carbon pricing policies also influence the price signal.18 The most obvious examples of indirect carbon pricing are fuel excise taxes and fossil fuel subsidies,which increase and decrease the net carbon price signal respectively.Accordingly,these fiscal policies pr

98、ovide a carbon price signal,even though they are often primarily adopted to achieve other(non-climate mitigation)objectives,such as raising revenue or financing road infrastructure.For example,fossil fuel subsidies can dilute the price signal provided by an ETS or a carbon tax.This is particularly i

99、mportant given their prevalence and magnitude globally,with the International Monetary Fund(IMF)estimating that explicit fossil fuel subsidies were around USD 1.3 trillion in 2022,which dwarfs the amount of revenue collected from carbon taxes and ETSs.19 Phasing out fossil fuel subsidies,where they

100、exist,is an essential step toward implementing effective carbon pricing.At the same time,opportunities exist to reform existing tax systems,such as fuel excise taxes,to better address the unpriced carbon externality.For instance,by broadening the fuels covered and/or aligning their rates with the ca

101、rbon content of the fuels,these indirect carbon prices could leverage existing tax frameworks to apply a strong and consistent price signal.Implementing carbon pricing by reforming existing fiscal frameworks can minimize the strain on administrative capacity while improving environmental incentives

102、and boosting government revenue.Broader carbon pricing metrics confirm the need for increased ambition in carbon pricing levels and coverage.The Organisation for Economic Co-operation and Development(OECD)has been instrumental in developing a holistic carbon pricing metric.In 2022,the OECD published

103、 its net effective carbon rates(nECR),which incorporate indirect(which OECD terms“implicit”)carbon pricing(by way of fossil fuel taxes and subsidies)in addition to direct(“explicit”)carbon pricing.The nECR provides a comprehensive bottom-up estimate for 71 countries for two years:2018 and 2021.To co

104、mplement this effort,the World Bank has developed an approach for estimating a total carbon price(TCP),which is similar in concept to the OECDs nECR,but includes value-added tax(VAT)differentials i and applies a top-down approach,using IMF data,to infer the existence of a net positive or negative ca

105、rbon price.While a top-down approach reduces the granularity provided by a detailed bottom-up approach,it allows for a significantly broader application,with a time horizon of up to 30 years and covering over 140 countries,including many lower-income countries.More comprehensive carbon pricing metri

106、cs(like nECR and TCP)aim to shed light on the broader carbon price incentives within an economy.Importantly,these metrics(like direct carbon pricing metrics)do not intend to measure the level of mitigation efforts,particularly because they do not account for non-pricing policies(such as technology m

107、andates or energy efficiency i VAT differentials occur where the VAT rates on fossil fuels are below the standard VAT rate.15 State and Trends of Carbon Pricing 2024AnnexesChapter 4Chapter 3Chapter 2ForewordExecutive SummaryChapter 1WORLDBANK.ORG Carbon taxation Emissions trading Net fuel Taxes(est.

108、)Net fuel subsidies(est.)VAT diff erentials Total Carbon Price(TCP)2000216040200-20Constant 2023 USD per tonne of CO2standards).Other measures are available to help estimate and compare mitigation effort,including“converting”mitigation policies into a carbon pricing equivalent.

109、However,there are challenges with converting non-pricing policies,largely because they are not primarily aimed at internalizing the social cost of emissions and such conversions cannot easily account for the role these policies provide in addressing other market failures and barriers.This includes,f

110、or example,support to ensure cost-effective mitigation technologies are accessible and investments to improve public infrastructure,which can improve the effectiveness and efficiency of carbon pricing.For example,promoting access to public transport systems can significantly increase the price elast

111、icity of transport emissions.20 Figure 2 provides a summary of the global total carbon price since 2015 using a combination of collected and estimated data.It highlights the influence of fuel taxes on the carbon price incentive,but also the negative impact of fossil fuel subsidies.These more compreh

112、ensive metrics,as well as others,such as the IMFs effective carbon price,21 provide a consistent overarching message:existing carbon price incentives,even if they include indirect carbon pricing,are insufficient to deliver the transformational changes needed to meet the Paris Agreement goals.FIGURE

113、2Global total carbon price for the period 2015-2021(USD 2023)Source:World Bank estimates based on the total carbon price working paper,adrawing on International Energy Agency energy balances for fuel consumption and on IMF fossil fuel subsidies data for fuel prices.Net fuel taxes and net fuel subsid

114、ies are complementary components.The TCP infers the presence of a net fuel tax or net fuel subsidy,based on the IMFs price-gap approach.b A net fuel tax reflects where supply costs are lower than retail prices,while a net fuel subsidy reflects where supply costs are higher than retail prices.a Paolo

115、 Agnolucci,et al.,“Measuring Total Carbon Pricing,”The World Bank Research Observer,September 27,2023,https:/doi.org/10.1093/wbro/lkad009b Ian Parry,S.Black,&N.Vernon.“Chapter 6 Measuring Fossil Fuel SubsidiesA Global and Country View.“In Data for a Greener World:A Guide for Practitioners and Policy

116、makers.USA:International Monetary Fund.April 2023,from https:/www.imf.org/en/Publications/Books/Issues/2023/04/04/Data-for-a-Greener-World-A-Guide-for-Practitioners-and-Policymakers-52246216 State and Trends of Carbon Pricing 2024AnnexesChapter 4Chapter 3Chapter 2ForewordExecutive SummaryChapter 1Ca

117、rbon taxes and emissions trading systemsCHAPTER 02WORLDBANK.ORGCHAPTER 2Carbon taxes and emissions trading systemsWhile positive progress on carbon pricing continues on many levels,more is required to meet the goals of the Paris Agreement.The number of carbon taxes and emissions trading systems(ETSs

118、)now stands at 75 globally.Middle-income countries and subnational governments are increasingly considering and implementing carbon taxes and ETSs.Over the past 12 months,progress was made on sector-specific multilateral initiatives for aviation and maritime emissions,and the EU Carbon Border Adjust

119、ment Mechanism(CBAM)entered into operation.Despite this progress,the level of global emissions covered by carbon pricing is unlikely to reach 30%in the short term.Changes to carbon price levels show a mixed picture,with some instruments experiencing increases and others decreases over the past year,

120、but prices in most jurisdictions remain below the levels required to meet the Paris Agreement goals.Revenues in 2023 increased slightly compared to 2022,passing the USD 100 billion threshold for the first time.Governments are exploring opportunities to cover nontraditional sectors like maritime tran

121、sport and waste,implementing multiple carbon pricing instruments in parallel,and pursuing their own individual approaches to the use of carbon credits to offset carbon pricing liabilities.2.1 Carbon pricing adoption has been limited over the last year,but there are promising signs of future uptake i

122、n middle-income countriesCarbon pricing continues to be implemented in new jurisdictions,albeit at a slow pace.The number of carbon pricing instruments in operation worldwide is now 75a net gain of two since April 2023(Figure 4).There are now slightly more carbon taxes in operation than ETSs.(39 tax

123、es versus 36 ETSs).Newly implemented instruments include Australias reform of its Safeguard Mechanism,which aligns its ambition with the countrys Nationally Determined Contribution and transformed The number of carbon pricing instruments in operation worldwide is now 75.18 State and Trends of Carbon

124、 Pricing 2024it into an intensity-based ETS,and Hungarys new carbon tax,which applies to EU ETS participants receiving at least half of their allowances for free.Slovenia reinstated its carbon tax while new carbon taxes were introduced in Taiwan,China,and the Mexican state of Guanajuato.In addition

125、to the new mandatory instruments listed previously,Japan created a new voluntary ETS,the GX ETS,which has been operational since October 2023 and is expected to transition into a mandatory ETS in 2026.Consolidation in Canada saw the cessation of individual provincial carbon taxes in New Brunswick,Ne

126、wfoundland and Labrador,and Prince Edward Island,where the Canadian federal fuel charge now applies.AnnexesChapter 4Chapter 3Chapter 1ForewordExecutive SummaryChapter 2WORLDBANK.ORG202420232022202000092008200720062005Carbon taxesETSs642002468Number of newl

127、y implemented instruments Lower middle income Upper middle income High income FIGURE 3ETS and carbon tax uptake by countries income group over time(2005-2024)Note:Year of implementation is based on month and year the instrument was originally implemented.Carbon pricing gained momentum in middle-inco

128、me countries.Indonesia launched its ETS for coal-fired power plants in the beginning of 2023.22 Trkiye announced at COP28 that it plans to launch the two-year pilot phase of its ETS for the energy and industry sectors in October 2024 once the enabling legislation is in effect.23 Market operations ar

129、e due to commence early in 2025.India adopted the legal basis for a carbon market(including an ETS)in 2022,and it established the institutional framework for the system over the past year,outlining roles and responsibilities of the different governing authorities.The intensity-based ETS will build o

130、n an existing scheme for energy efficiency in emission-intensive industrial sectors,with the potential to evolve into a compliance carbon market.24 Legislation that would create an ETS with a pilot phase toward the end of the decade is under consideration by Brazils Congresso Nacional.25 Argentina i

131、s considering the establishment of an ETS for the energy sector.The initiative was first considered as part of an omnibus law,which introduced a broader package of economic reform measures.26 Efforts for other ETSs in Latin America are also underway,including in Chile and Colombia.Figure 3 shows the

132、 number of carbon taxes and ETSs entering into force each year since 2005 and the continued momentum for both instruments in middle-income countries throughout the past decade.FIGURE 3ETS and carbon tax uptake by countries income group over time(2005-2024)19 State and Trends of Carbon Pricing 2024Ye

133、ar of implementation is based on month and year the instrument was originally implemented.AnnexesChapter 4Chapter 3Chapter 1ForewordExecutive SummaryChapter 2WORLDBANK.ORGDespite some setbacks,there is steady momentum for carbon pricing at the subnational level.Half of all carbon pricing instruments

134、 established over the last three years were at a subnational level.Mexico had five subnational systems in 2022 and is expected to have eight by the end of 2024(see details in Table 1),reflecting states continued interest in carbon taxes as a new source of revenue.The Malaysian State of Sarawak passe

135、d legislation to introduce a carbon tax aimed at reducing emissions and promoting carbon capture and storage.27 Subnational carbon pricing in Canada saw a consolidation with the federal carbon pricing backstop now being applied in an additional four provinces.In the United States,a number of states

136、suspended or withdrew from carbon pricing,while other states made progress to enact new or expand existing carbon pricing instruments.TABLE 1 Key carbon pricing developments at the subnational level in the past yearCanadaNova Scotia,New Brunswick,Prince Edward Island,Newfoundland and LabradorOpted t

137、o apply the federal levy as an alternative to reforming their provincial systems.28British ColumbiaIncreased the scope of its ETS to comply with federal regulation.MalaysiaSarawakPassed legislation for the introduction of carbon pricing policies to support the achievement of net zero by 2050.Industr

138、ial emitters passing mandatory emission-intensity benchmarks will become subject to a carbon tax.29MexicoTamaulipasPlans to reinstate its carbon tax in 2024 after the Mexican Supreme Court declared the constitutionality of the instrument.30GuanajuatoIntroduced its carbon tax in the past year.31Duran

139、goThe tax entered into force in 2024 after being introduced to the legislation in 2023San Luis PotosPlans to introduce its carbon tax have been delayed until June 2024.32ColimaIs considering introducing a carbon tax.33United StatesColorado ETS will enter into force in December 2024 with an expanded

140、scope covering 18 industrial facilities in addition to the four that were originally covered by the program.34State of New YorkAdvanced the development of an economy-wide cap-and-invest program.35RGGI/MarylandIs considering an economy-wide program for industrial sector emissions in addition to power

141、 sector emissions,which are already covered under the Regional Greenhouse Gas Initiative(RGGI).36RGGI/North Carolina,Virginia,PennsylvaniaDecided not to join the RGGI,withdrew from the process,or court ruling on withdrawal is pending.37Oregon Actively developing regulations to reinstate the Carbon P

142、rotection Program,including an ETS,after the Oregon Court of Appeals invalidated it in December 2023.3820 State and Trends of Carbon Pricing 2024AnnexesChapter 4Chapter 3Chapter 1ForewordExecutive SummaryChapter 2WORLDBANK.ORGIndonesiaSingaporeBruneiDarussalamNew ZealandKazakhstanPakistanThailandTrk

143、iyeChinaColombiaChileIsraelArgentinaUruguayOregonWashingtonPennsylvaniaMassachusetts QubecOntarioSaskatchewanAlbertaNorthwestTerritoriesBritish ColumbiaRGGINew YorkBrazilHawaiiAustraliaCanada NorwayUKSwedenSpainPortugalPolandNetherlandsLithuaniaLatviaItalyIrelandGreeceGermanyFranceFinlandEstoniaDenm

144、arkBelgiumLuxembourgLiechtensteinCataloniaSloveniaAustriaSwitzerlandHungaryMontenegroAlbaniaMaltaTaiwan,ChinaTokyoTianjinShenzhenShanghaiSaitamaHubeiGuangdong(except Shenzhen)FujianChongqingBeijingJapanRepublic of KoreaSakhalinTokyoSaitamaCzech RepublicRomaniaUkraineBulgariaCroatiaSlovak Rep.CyprusV

145、iet NamMalaysiaPhilippinesSouth AfricaBotswanaSenegalCte dIvoireMoroccoIcelandMexicoJaliscoColimaZacatecasState of MexicoYucatnGuanajuatoDurangoSan Luis PotosQuertaroNova ScotiaParaguayKenyaMauritaniaCalifornia ColoradoIndiaTamaulipasNew BrunswickNewfoundlandand LabradorManitobaFIGURE 4Map of carbon

146、 taxes and ETSs ETS and carbon tax implemented ETS implemented Carbon tax implemented ETS or carbon tax under consideration or under developmentInstruments“under development”are where a government is actively working toward the implementation of a carbon pricing instrument and this has been formally

147、 confirmed by official government sources.This includes,for example,where a mandate has been established,but regulated entities do not yet face compliance obligations.If a government has announced its intention to work toward the implementation of a carbon pricing instrument and official government

148、sources formally confirm that intention,the instrument is“under consideration.”For those countries with multiple instruments that have both“under development”or“under consideration”and“implemented”instruments,the map will show the status of the latter.The status of instruments in subnational jurisdi

149、ctions is also reflected in the map.21 State and Trends of Carbon Pricing 2024AnnexesChapter 4Chapter 3Chapter 1ForewordExecutive SummaryChapter 2WORLDBANK.ORGFIGURE 5Global GHG emissions covered by ETSs and carbon taxes1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020

150、2022 2024Emissions(GtCO2e)Carbon tax Overlap ETS Total covered emissions(right axis)12108642-Percentage of global emissions covered by ETSs and carbon taxes 25%20%15%10%5%0%A stable share of global GHG emissions covered by carbon taxes and ETSs masks a number of important changes.As of April 1,2024,

151、ETSs and carbon taxes in operation covered almost 13 gigatons of carbon dioxide equivalent,around 24%of global GHG emissions.While the share remained largely unchanged over the past year,the level of covered emissions rose by over 400 million metric tons of carbon dioxide equivalent(MtCO2e)in 2023(s

152、ee Figure 5).39 This includes additional emissions covered by Australias new ETS as well as new(and reinstated)carbon taxes at the national and subnational levels across other countries.While newly implemented and expanded carbon pricing instruments increase the share of global covered emissions,thi

153、s effect can be reduced,or potentially reversed,as carbon pricing instruments deliver on their objective of reducing emissions.Indeed,for many jurisdictions the level of covered GHG emissions declines over time.This is demonstrated,for example,by a declining cap in an ETS.This is expected,given that

154、 the intended purpose of carbon pricing is to drive down emissions.All other things being equal,the presence of a successful carbon pricing policy will reduce emissions,which results in a declining share of globally covered emissions.For instance,emissions in the EU,California,and South Africa have

155、been steadily decreasing since the introduction of carbon pricing instruments in those jurisdictions.40 The“Fit for 55”reforms to the EU ETS provide a good example of how policy changes to increase ambition can either decrease or increase covered emissions.The EU ETS scope was expanded to include ma

156、ritime transport in 2024,increasing coverage(and the ETS cap)by 78 MtCO2e.At the same time,to increase the level of ambition reflected in the EU ETS,the cap was reduced by almost 180 MtCO2e.While both of these policy changes reflect an increase in ambition,they have opposite effects on the level of

157、covered emissions.22 State and Trends of Carbon Pricing 2024AnnexesChapter 4Chapter 3Chapter 1ForewordExecutive SummaryChapter 2WORLDBANK.ORGCarbon taxes and ETSs currently being considered would boost global coverage,but are unlikely to exceed 30%in the short term.ETSs currently under consideration

158、 and development in Brazil,India,and Trkiye could cover approximately 3%of global GHG emissions based on current emissions profiles and depending on final coverage rules.Therefore,even with the implementation of carbon pricing in these large and strategically important economies,global emissions cov

159、erage may remain under 30%in the near future.This highlights the level of ambition and scale of action required to meet the Global Carbon Pricing Challenge,which was announced at COP26 with a goal of covering 60%of global GHG emissions by 2030.Higher coverage levels(i.e.,covering a larger portion of

160、 the economy)in existing or planned instruments can also help achieve this goal.However,there are often practical limits on policy coverage.For example,even a broadly applied ETS like the Washington Cap-and-Invest Program,which applies to the power,industry,building,and transport sectors,only covers

161、 around 70%of Washington States emissions.The commencement of the EU Carbon Border Adjustment Mechanism represents a significant shift in the global carbon pricing landscape,adding a strong driver for carbon pricing.The EU CBAM is designed to apply a direct carbon price on imports that is equivalent

162、 to the EU ETS.This is intended to level the carbon pricing playing field between domestic producers covered by the ETS and producers in countries that export to the EU.It does this by effectively applying a carbon price to emissions embedded in imports of covered goods.Based on the current scope of

163、 the EU CBAM,this represents between 0.15%and 0.6%of global emissions(see Figure 6).41 The transitional phase of the EU CBAM started in October 2023,requiring EU importers to Australia,Canada,and Japan are also weighing the implementation of their own domestic border carbon adjustments.report the em

164、bedded emissions of products including specified imports of iron and steel,aluminum,hydrogen,fertilizers,cement,and electricity.The European Commission has highlighted the potential to expand the CBAM to other industrial products in Article 30 of the CBAM Regulation.Payments will be required from 20

165、26,which has spurred governments to consider implementing carbon pricing to reduce potential CBAM costs.Countries including India,Indonesia,Morocco,Trkiye,Ukraine,Uruguay,and Western Balkan countries,have implemented,adjusted,or are considering implementing direct carbon pricing to reduce CBAM compl

166、iance costs and to capture revenue that would otherwise be paid to the EU.42 Australia,Canada,and Japan are also weighing the implementation of their own domestic border carbon adjustments.43 The UK has announced it will introduce a CBAM with a scope broadly comparable to the EUs in 2027.44 Without

167、due consideration,the introduction of new reporting requirements to facilitate border carbon adjustments(or other measures mandating reporting or certification)can increase administrative and transaction costs.This could unintentionally restrict participation in global markets,particularly for small

168、er or less sophisticated businesses.This risk can be minimized by streamlining and harmonizing reporting requirements to minimize costs and avoid imposing unintentional barriers to trade.23 State and Trends of Carbon Pricing 2024AnnexesChapter 4Chapter 3Chapter 1ForewordExecutive SummaryChapter 2WOR

169、LDBANK.ORG40%30%20%10%0Percentage of global emissionsCoverage of existing carbon pricing instruments24%of global emissions in 2024 Share of total(upper)Share of total(lower)Carbon pricing insturments under developmentCarbon pricing instruments under considerationAround 5-6%CBAMAround 2-3%Around 0.2-

170、0.6%CORSIAAround 0.5-0.8%IMOAround 0.8-1.4%FIGURE 6Indicative estimates of the potential GHG emissions covered by different carbon pricing instruments and international initiativesThe upper bounds of the estimates are presented as blurred colors.All emissions data are based on GHG emissions from the

171、 Emissions Database for Global Atmospheric Research(EDGAR version 8.0,https:/edgar.jrc.ec.europa.eu/),or are from domestic inventories in the case of subnational jurisdictions.Additional information on the methodology and sources is provided in Annex B.24 State and Trends of Carbon Pricing 2024Secto

172、r-specific multilateral initiatives for carbon pricing are also growing.The Carbon Offsetting and Reduction Scheme for International Aviation(CORSIA)led by the International Civil Aviation Organization(ICAO)aims to stabilize CO2 emissions from international aviation.It uses a baseline-and-offset app

173、roach that requires airlines to buy carbon credits to offset emissions above their baseline.CORSIA has three implementation phases,with evolving participation requirements and criteria for units eligible for compliance.The pilot phase concluded in early 2024,beginning the first(voluntary)phase,and a

174、 compliance phase will begin in 2027.45 In July 2023,the International Maritime Organization(IMO)adopted a revised strategy to reduce GHG emissions from international shipping that includes the development of a GHG emissions pricing instrument.It is intended to enter into force by 2027.46 While mult

175、ilateral initiatives for sectoral carbon pricing are slow in making progress and in reaching the necessary level of ambition,they can incentivize mitigation in sectors not covered by the Paris Agreement and those generally beyond the reach of domestic carbon pricing systems.In this way,these interna

176、tional transport initiatives can contribute to the proportion of global GHG emissions facing carbon price incentives.Taken together,CORSIA and the IMO carbon pricing efforts represent around 1.5%of global GHG emissions(see Figure 6).AnnexesChapter 4Chapter 3Chapter 1ForewordExecutive SummaryChapter

177、2WORLDBANK.ORGFIGURE 7Prices and coverage across ETSs and carbon taxes,as of April 1,202425 State and Trends of Carbon Pricing 20242030 price range recommended by the High-Level Commission on Carbon Prices to limit temperature rise to well below 2C.USD 63-127 per tCO2e2402200806040200USD

178、per tCO2e Figure 7Prices and coverage across ETSs and carbon taxes,as of April 1,2024 Indonesia ETSUkraine CTArgentina CTSaitama ETSKazakhstan ETSJapan CTEstonia CTMassachusetts ETSGuanajuato CTState of Mexico CTFujian pilot ETSMexico CTTianjin pilot ETSChile CTHubei pilot ETSChongqing pilot ETSDura

179、ngo CTRep.of Korea ETSColombia CTGuangdong pilot ETSShenzhen pilot ETSTaiwan,China CTShanghai pilot ETSSouth Africa CTChina national ETSAlbania CTBeijing pilot ETSZacatecas CTLatvia CTSpain CTRGGIYucatan CTSingapore CTSlovenia CTAustralia ETSUK CTWashington ETSMontenegro ETSDenmark CTNew Zealand ETS

180、Iceland CTQuertaro CTTokyo ETSCalifornia ETSQubec ETSHungary CTUK ETSFrance CTGermany ETSAustria ETSLuxembourg CTCanada ETSs(Federal and Provinces)Canada CTs(Federal and Provinces)Switzerland ETSIreland CTEU ETSNetherlands CTNorway CTFinland CTSweden CTSwitzerland CTLiechtenstein CTUruguay CT2030 ca

181、rbon price levels consistent with limiting temperature rises to 1.5 C.USD 226-385/tCO2e380 Carbon taxes ETSsCoverage of jurisdictions emissions60%Carbon taxes ETSsCoverage of jurisdictions emissions60%The figure displays specific instrument prices and coverage.See Annex B for additional information.

182、AnnexesChapter 4Chapter 3Chapter 1ForewordExecutive SummaryChapter 2WORLDBANK.ORGDirect carbon prices have increased over the last decade,but the past year saw mixed developments.Most instruments saw increasing prices in nominal terms.More than half of the carbon taxes in operation increased the nom

183、inal tax rate over the past year as the result of scheduled increases or tax reforms and the remaining taxes have retained existing tax rates(see Figure 8).While carbon tax levels are by design more stable than ETS prices,the picture on ETS prices was particularly heterogeneous over the past year.Te

184、n ETSs,covering around 5%of global emissions,saw nominal price decreases,including significant price falls in large long-standing systems like the New Zealand ETS,the ETS in the Republic of Korea,the EU ETS,and the UK ETS.While short-term fluctuations in ETS prices are not necessarily a reason for c

185、oncern,persistent price falls and volatility have the potential to undermine the longer-term price signal and therefore investment certainty.The drivers for the price reductions experienced during 2023 varied across jurisdictions.In the EU,economic stagnation and reduced consumption of fossil energy

186、 in the aftermath of the energy price crisis contributed to reducing industrial and power sector emissions,putting downward pressure on EU ETS prices.48 In New Zealand,a key driver was market expectations caused by uncertainty surrounding the potential for excess allowances in the coming years,which

187、 saw prices fall.492.2 Carbon prices remain insufficient despite a decade of strong growthMore ambition in ETSs and carbon taxes is necessary to attain a 1.5C pathway.In 2017,the High-Level Commission on Carbon Prices concluded that carbon prices needed to be USD 40-80/ton of carbon dioxide equivale

188、nt(tCO2e)in 2020 and reach USD 50-100/tCO2e by 2030 to be on track to limit temperature rises to well below 2C.47 In 2024,only seven carbon pricing instruments,covering less than 1%of global GHG emissions,reached price levels at or above the inflation-adjusted minimum level of USD 63 per tCO2e(in 20

189、24 USD).Further,all existing carbon prices are below the lower carbon price bound set by the Intergovernmental Panel on Climate Change(IPCC)the IPCC estimates that the marginal abatement cost to limit warming to 1.5 C is USD 170 to 290 per tCO2e(226 to 385 in 2024 USD terms).While coverage with carb

190、on taxes and ETSs has been continuously increasing and new initiatives are being developed,the majority of these carbon pricing instruments are not ambitious enough to drive the level of change required to meet the Paris Agreements temperature goals.The majority of these carbon pricing instruments a

191、re not ambitious enough to drive the level of change required to meet the Paris Agreements temperature goals.26 State and Trends of Carbon Pricing 2024AnnexesChapter 4Chapter 3Chapter 1ForewordExecutive SummaryChapter 2WORLDBANK.ORG2002020224USD per tCO2eGuangdong pilot ETSEU E

192、TSCalifornia Cap and TradeAlberta SGER/CCIR/TIERRep.of Korea ETSChina national ETSGermany ETSHubei pilot ETS02002002020224France carbon taxUK Carbon Price SupportMexico carbon taxSouth Africa carbon taxUkraine carbon taxNetherlands carbon taxJapan carbon taxArgentina

193、 carbon taxUSD per tCO2e0200i The Indonesia ETS,the Mexico ETS,and the Kazakhstan ETS have a high absolute coverage of GHG emissions.However,they are not presented in the graph due to insufficient data availability.27 State and Trends of Carbon Pricing 2024Emissions trading systemsCarbon

194、taxesFIGURE 8Nominal prices in the largest ETSs and carbon taxes in operation since 2017 iAnnexesChapter 4Chapter 3Chapter 1ForewordExecutive SummaryChapter 2WORLDBANK.ORG2.3 Revenues from carbon pricing continue to climbCarbon pricing revenues continued to increase in 2023,exceeding the threshold o

195、f USD 100 billion for the first time.Total revenues from carbon taxes and ETSs in 2023 was USD 104 billion,representing an increase of around 4%in real terms.The largest single contributor to global carbon revenue,the EU ETS,saw inflation adjusted revenue in 2023 increase by around 4%compared to the

196、 previous year,largely driven by higher allowance prices.Real revenues from the German ETS increased by almost 60%,despite a suspension of a planned price increase(as part of the ETSs initial fixed-price phase).This increase was largely due to firms postponing their allowance purchases to early 2023

197、 for their 2022 compliance obligations,temporally shifting revenues for the country.The new cap-and-invest program in Washington State generated USD 1.8 billion.The revenue increases from these three instruments outweighed lower revenues in other jurisdictions.This includes the UK ETS,which collecte

198、d around 36%less revenue(in real terms)compared to 2022 as a result of a decrease in allowance prices,and New Zealand where no auction revenues were collected from the ETS during 2023.However,recent price drops in the EU ETS,which is the largest contributor to global carbon revenues,suggests global

199、carbon pricing revenues may fall in 2024.ETSs continue to generate the majority of direct carbon pricing revenue with higher revenues possible if free allocations are reduced.ETSs accounted over 70%of global government carbon pricing revenues,primarily due to the greater amount of emissions they cov

200、er,and because of the high price levels in large ETSs,like the EU ETS(see Figure 9).However,the high share of freely allocated ETS allowances,which can be viewed as foregone revenue,reduces the revenue potential from ETSs.While auctioning has advantages in terms of revenue generation,price discovery

201、,and preserving incentives for cost-effective abatement,jurisdictions often introduce accompanying measures to manage social and economic impacts and build broader community acceptance.All but four ETSs(Austria,Germany,Massachusetts,and RGGI)freely allocate allowances to varying degrees,mostly as a

202、way of easing the transition to a carbon-constrained world and protecting the competitiveness of domestic industries while still providing a price signal to incentivize emission reductions.More than a third of ETSs freely allocate 100%of allowances,while others use a combination of auctioning and fr

203、ee allocation.For example,California,the EU and New Zealand all allocate roughly half of their allowances for free.Some carbon tax regimes also include small rebates and exemptions.28 State and Trends of Carbon Pricing 2024Total revenues from carbon taxes and ETSs in 2023 was USD 104 billion.Annexes

204、Chapter 4Chapter 3Chapter 1ForewordExecutive SummaryChapter 2WORLDBANK.ORGThe contribution of carbon pricing revenue to jurisdictions overall budgets remains small.Despite increases(see Figure 9),revenue from carbon pricing remains a small part of countries total budgets.The largest contribution of

205、carbon pricing to a national budget was seen in Germany,where the national ETS and the EU ETS together made up around 4%of government revenue in 2023.50 This suggests that there is an opportunity for reforms to help achieve fiscal,economic,social,and environmental goals.Environmental fiscal instrume

206、nts like carbon taxes and ETSs(with auctioning)can raise revenue with a lower negative impact on employment and can cover the informal sector better than conventional taxes,such as labor or corporate taxes.51 This becomes increasingly relevant at higher levels of taxation.The adoption of carbon pric

207、ing in Ireland,where a carbon tax was implemented in 2010 in response to the global financial crisis,demonstrates how embedding carbon pricing into broader tax reforms may increase acceptance as its benefits beyond climate mitigation can be highlighted.The majority of jurisdictions use carbon pricin

208、g revenues to either fund climate-related programs or to support the general budget.There are many potential uses of carbon revenue to meet a range of policy objectives,and as with all fiscal instruments revenue decisions for carbon taxes and ETSs can be challenging given the competing priorities ac

209、ross economic,social,and environmental objectives.Different ministries within a single government often take a different view,such as when the Czechias environment and industry ministries favored earmarking,while the finance and transport ministries argued for using revenues to support the countrys

210、general budget and consolidate its debt.53 Data from the Institute for Climate 2002020200Billion USD104 billionFIGURE 9Evolution of global revenues over time29 State and Trends of Carbon Pricing 2024 Carbon tax(nominal USD)ETS (nominal USD)Total revenues(constant USD

211、 2023)AnnexesChapter 4Chapter 3Chapter 1ForewordExecutive SummaryChapter 2WORLDBANK.ORGEconomics(I4CE)presented in Figure 10 shows that the majority of revenue has historically been channeled either toward green and development projects or to the general budget.49 The green and development project c

212、hannel accounts for more than half of global carbon revenue collected in 2022.For example,the EU requires its member states to dedicate at least half of allocated ETS revenues for climate and energy purposes,which resulted in large government expenditures directed toward green transport(20%),energy

213、efficiency(17%),and renewable energy(12%).The general budget channel accounts for around a quarter of global carbon revenue.For instance,in France and the UK,revenues from their national carbon prices feed into their respective general budgets.Households and businesses that may be disproportionately

214、 affected by carbon pricing receive 10%of global carbon revenue in redistributions.54 For instance,Austria and Canada return a larger portion of the revenue from carbon pricing to households.In Canada,approximately 8 out of 10 households receive more money back than the total amount spent on the car

215、bon tax.55 ETSs Carbon tax Figure 10Revenue usage from carbon taxes and ETSs in 2022Climate&natureETSsCarbon taxes Transfers to householdsClimate&natureTransfers to householdsOther revenue usesUnspecifi ed-general budgetUnspecifi ed-general budgetOther revenue usesFIGURE 10Revenue usage from carbon

216、taxes and ETSs in 202230 State and Trends of Carbon Pricing 2024Source:Based on I4CE Data.56 Includes revenue usage from largest carbon pricing instruments by revenue in 2022AnnexesChapter 4Chapter 3Chapter 1ForewordExecutive SummaryChapter 2WORLDBANK.ORGAround 70%of jurisdictions with carbon pricin

217、g have more than one carbon pricing instrument in place.2.4 Flexible policy designs and approaches continue to emerge,reflecting the adaptability of carbon pricing to national circumstances Governments are increasingly using multiple carbon pricing instruments in parallel to increase coverage and am

218、bition and to deliver greater flexibility.While some jurisdictions have implemented a single carbon pricing instrument to apply a domestic price incentive(e.g.,ETSs in California and New Zealand and carbon taxes in Singapore and South Africa),around 70%of jurisdictions with carbon pricing have more

219、than one carbon pricing instrument in place.About a quarter of these jurisdictions introduced a second instrument within the past three years.While establishing a second instrument can potentially increase administrative and transaction costs and regulatory complexity(e.g.,through overlapping report

220、ing requirements),it can support the expansion of coverage,help to increase the level of the carbon price,and be used to trial new approaches.In most cases,including in EU member states and Mexican states,the coexistence of two instruments stems from different levels of government having different c

221、arbon pricing policy objectives.In Canada,the federal government provides implementation flexibility to subnational governments.In the EU,some national governments use a second instrument to extend carbon pricing policy coverage to sectors that are not covered by the EU ETS such as road transport.Wh

222、ile most examples are in the form of carbon taxes(e.g.,Denmark and Portugal),second ETSs have also been implemented in Austria and Germany.Other jurisdictions apply a second instrument to the same sectors at different governance levels.Hungarys carbon tax,introduced in 2023,applies to EU ETS partici

223、pants that receive a majority of allowances for free.Netherlands has a carbon tax which is intended to promote decarbonization by topping up the carbon price incentive provided by the EU ETS.China has a national ETS,but also has regional pilot ETSs that were set up to experiment with design options

224、and draw lessons for the national ETS.There are fewer examples of two instruments being implemented at the same governance level in a jurisdiction.Current examples include the UK(which,like Netherlands,uses a tax to top up the ETS price incentive),Canada,and Mexico.The EU ETS 2,covering buildings an

225、d transport,will result in separate ETSs in the EU being applied to different emission sources.Thailand is also exploring,among other options,the potential to introduce an ETS and a carbon tax to operate simultaneously.Governments are increasingly exploring carbon pricing in new sectors,but carbon p

226、ricing remains most common in the power and industry sectors.More than half of all ETSs and carbon taxes cover the power sector(Figure 11).ii More than three quarters of all ETSs and carbon taxes cover industry(including mining).These sectors tend to be covered more by ETSs than taxes because ETSs w

227、ith point-source regulation offer more intertemporal flexibility for big emitters as the instruments allow trading and hedging.In contrast,road transport and buildings tend to be covered more by carbon taxes,which are more often applied upstream(e.g.,at the point fuel enters the economy),allowing co

228、verage of fuel combustion emissions from small sources like vehicles.Governments are increasingly looking to ii Excluding instruments that cover the sector in principle,with negligible or no de facto coverage.31 State and Trends of Carbon Pricing 2024AnnexesChapter 4Chapter 3Chapter 1ForewordExecuti

229、ve SummaryChapter 2WORLDBANK.ORGIndustryMining and extractivesBuildingsAviationWaste Carbon tax covering sector Carbon tax covering sector in principle ETS covering sector ETS covering sector in principle FIGURE 11Covered sectors in implemented ETSs and carbon taxesTransportLULUCFElectricity and hea

230、tAgriculture,forestry,and fi shing fuel useplace a carbon price on less traditional sectors,including shipping and waste.Carbon pricing in Germany,the Republic of Korea,and Singapore covers solid waste or waste incineration,and the UK will start including energy-from-waste and waste incineration emi

231、ssions in 2028.This is a sector that can be complicated to regulate because of the long time frame over which emissions occur and because the waste generator generally does not operate waste management(e.g.,landfills).Maritime transport is also an area of growing coverage.The ETS in the Republic of

232、Korea and the Shanghai Pilot Emissions Trading System have been covering emissions from maritime transport since 2021 and 2016,respectively.The EU ETS has started phasing in surrender obligations for CO2 emissions from all large ships(5,000 gross tonnage)entering EU ports.Starting in 2026,it will al

233、so consider CH4 and N2O emissions.The UK ETS will cover emissions from domestic maritime transport in 2026.FIGURE 11Covered sectors in implemented ETSs and carbon taxesEach square represents a single instrument.This figure is not intended to display overlap between covered emissions(e.g.,Massachuset

234、ts ETS and RGGI)or multiple instruments(e.g.,UK ETS and UK carbon price support mechanism).32 State and Trends of Carbon Pricing 2024AnnexesChapter 4Chapter 3Chapter 1ForewordExecutive SummaryChapter 2WORLDBANK.ORG Figure 12Carbon credit use in ETSs and carbon taxes ETS CT(carbon tax)Allow domestic

235、and international credits Allow domestic credits and credits from linked systems Only allow domestic credits Australia ETSallow the use of off sets40%20%40%60%80%100%Indonesia ETSKazakhstan ETSSaitama ETSTokyo ETSChile CTMexico CTCanada federal ETSColombia CTAlberta ETSBritish Columbia ETSQuertaro C

236、TShenzhen pilot ETSFujian pilot ETSGuangdong pilot ETSHubei pilot ETSMexico pilot ETSSouth Africa CTTianjin pilot ETSChongqing pilot ETSWashington ETSBeijing pilot ETSChina national ETSSwitzerland CTRGGIShanghai pilot ETSQubec ETSCalifornia ETSRep.of Korea ETSSingapore CTFIGURE 12Carbon credit use i

237、n ETSs and carbon taxesGovernments allow regulated entities to use carbon credits toward their GHG obligations to increase flexibility,lower compliance costs,and extend the carbon price signal to uncovered sectors.Currently,around 40%of carbon pricing instruments in operation(7 carbon taxes and 23 E

238、TSs),allow for the use of carbon credits to offset liabilities(see Figure 12).Most do so with restrictions.For example,almost all jurisdictions only permit the use of domestically generated carbon credits.Singapore began allowing businesses liable to pay the carbon tax to use international carbon cr

239、edits that meet defined environmental integrity criteria to offset up to 5%of their taxable emissions in January 2024.Carbon taxes permitting the use of domestically generated carbon credits to offset tax liabilities include Chile,Colombia,and South Africa.Among ETSs,California,Mexico,and the Republ

240、ic of Korea,as well as others,allow for the limited use of carbon credits from specified crediting mechanisms.33 State and Trends of Carbon Pricing 2024AnnexesChapter 4Chapter 3Chapter 1ForewordExecutive SummaryChapter 2Carbon crediting markets and mechanismsCHAPTER 03WORLDBANK.ORG3.1 New crediting

241、mechanisms coming online will boost supply outlook,which may begin to counterbalance recent falls in issuances Governments,particularly in middle-income countries,are increasingly including crediting frameworks in their policy mix,with a view to supporting both compliance and voluntary markets.Some

242、middle-income countries see the development and expansion of domestic carbon credits as a springboard for participation in international carbon markets,which can serve as a vehicle to fund the low-carbon transition.57 Others focus on domestic use instead of selling carbon credits on international ma

243、rkets.These two motivating factors have generated significant CHAPTER 3Carbon crediting markets and mechanismsCarbon credit markets navigated relatively turbulent conditions during 2023.While concerns about credit quality and integrity of claims persisted,there was widespread progress on initiatives

244、 to promote confidence and build trust.However,the impact of these initiatives will take time to be realized.The downward trend of credit issuances,which started in 2022,continued.However,new and planned crediting mechanisms and approaches improved the supply outlook,targeting different demand segme

245、nts across the domestic-international and voluntary-compliance spectrums.Demand for carbon credits continues to be mostly driven by voluntary purchases,although compliance demand is emerging.Carbon credit prices mostly declined,though credit types with specific features,such as high co-benefits or r

246、ecent vintages,traded at a premium,which is particularly noticeable in over-the-counter(OTC)trades.35 State and Trends of Carbon Pricing 2024progress on crediting mechanisms across several jurisdictions in the last year.Looking forward,several initiatives are in place to support countries in gaining

247、 access to international credit demand,providing up-front and large-scale carbon finance,outlining standard operating procedures,delivering technical assistance,and offering capacity building,among many other support measures.58Demand for carbon credits continues to be mostly driven by voluntary pur

248、chases,although compliance demand is emerging.AnnexesChapter 4Chapter 2Chapter 1ForewordExecutive SummaryChapter 3WORLDBANK.ORGThe roles of emerging governmental crediting mechanisms and approaches to implementation are diverse.New crediting mechanisms have been launched in five jurisdictions since

249、2023,including three at the national level(Chile,Portugal,and Saudi Arabia)and two in North American subnational jurisdictions(Nova Scotia and Washington).With these most recent additions,governmental crediting mechanisms now amount to 35 globally(see Figure 13).Moreover,another 11 jurisdictions are

250、 currently considering carbon crediting mechanisms as part of their policy mix.This includes India,which has revised its carbon pricing plans,simultaneously advancing a baseline-and-credit ETS and a national crediting mechanism.Thailands domestic crediting mechanism,the Thailand Voluntary Emission R

251、eduction Scheme(T-VER)has upgraded its standard to Premium T-VER to promote alignment with international standards,attracting interest from international buyers.59 Thailand is also considering the development of a carbon tax or ETS,which could allow the use of T-VER credits to offset compliance requ

252、irements.60 In Viet Nam,the government aims to establish a crediting mechanism focused on the solid waste and transport sectors to support its ETS commencing in 2028 with provisions allowing for participation under Article 6 of the Paris Agreement.61 After a six-year suspension,China has relaunched

253、project registrations under its China Certified Emissions Reduction Scheme,providing a supply of credits that companies can potentially use to offset a share of their compliance obligations under the Chinas national ETS and the pilot ETSs of Beijing,Chongqing,Fujian,Guangdong,Hubei,Shanghai,Shenzhen

254、,and Tianjin.62 In September 2023,Chile launched a crediting mechanism to allow companies to reduce carbon tax liabilities using credits from specified methodologies under the Clean Development Mechanism(CDM),Verified Carbon Standard(VCS),and Gold Standard.63 In March 2024,Chile officially approved

255、the first eight renewable energy projects under these standards.64 In Brazil,the February 2024 draft ETS bill set out a framework for the acceptance of carbon credits to meet compliance obligations through a“gatekeeping”model that,if approved,will rely on existing crediting mechanisms.The EU Carbon

256、Removals Certification Framework,which is focused on stimulating carbon removals through robust and standardized certification of removal credits,was adopted by the European Parliament in April 2024,and awaits adoption by the European Council.65 The legislation only allows removal credits to contrib

257、ute toward European climate objectives,excluding them from use towards third countries NDCs and international compliance schemes such as CORSIA.6636 State and Trends of Carbon Pricing 2024Governmental crediting mechanisms now amount to 35 globally.AnnexesChapter 4Chapter 2Chapter 1ForewordExecutive

258、SummaryChapter 3WORLDBANK.ORGTaiwan,China Voluntary GHG Reduction ProgramNova Scotia Crediting MechanismQubec OffsetCrediting MechanismBritish ColumbiaOffset ProgramRGGI CO2Offset MechanismAlberta EmissionOffset SystemWashington CreditingMechanismSri Lanka Carbon Crediting MechanismSouth AfricaCredi

259、ting MechanismIndo-Pacific Carbon Offsets SchemeMexico Crediting MechanismKazakhstan CreditingMechanismThailand VoluntaryEmission ReductionProgramSpain FES-CO2 ProgramSwitzerland CO2Attestations CreditingMechanismChina GHG VoluntaryEmission Reduction ProgramColombia Crediting Mechanism Chile Crediti

260、ng MechanismCalifornia Compliance Offset ProgramJoint Crediting MechanismRepublic of Korea Offset Credit MechanismJ-Credit Scheme Tokyo Cap-and-Trade ProgramBeijing Forestry Offset MechanismBeijing Parking Offset Crediting MechanismGuangdong Pu Hui Offset Crediting MechanismSaitama Target Setting Em

261、issions Trading SystemSaitama Forest Absorption Certification SystemChongqing Carbon Offset MechanismFujian Forestry Offset Crediting MechanismIndia CreditingMechanismSakhalin OblastPilot Crediting MechanismUK WoodlandCarbon CodeViet Nam CreditingMechanismIndonesia CreditingMechanismCanada FederalGH

262、G Offset SystemAustralian Carbon Credit Unit SchemePortuguese Voluntary Carbon Market Greenhouse Gas Crediting and Offsetting MechanismClimate Credit SystemMurcia Crediting MechanismVoluntary Carbon Credit SystemPeatlandCodeA.R.of Egypt Crediting MechanismEcuador Crediting MechanismEU Carbon Removal

263、 Certification FrameworkFIGURE 13Map of governmental crediting mechanisms Implemented Under consideration/developmentAn instrument“under development”means that a government is actively working towards the implementation of a crediting mechanism,and this has been formally confirmed by official govern

264、ment sources.This includes,for example,where a mandate has been established but no credits have been issued.If a government has announced its intention to work toward the implementation of a crediting mechanism and official government sources formally confirm that intention,the instrument is“under c

265、onsideration.”For those countries with multiple crediting mechanisms that have both“under development”or“under consideration”and“implemented”crediting mechanisms,the map will show the status of the latter.The status of crediting mechanisms in subnational jurisdictions is also reflected in the map.37

266、 State and Trends of Carbon Pricing 2024AnnexesChapter 4Chapter 2Chapter 1ForewordExecutive SummaryChapter 3WORLDBANK.ORGBOX 2Understanding carbon credit marketsCarbon credit markets trade“carbon credits,”which are units that are generated through voluntarily implemented mitigation activities.Carbon

267、 credits can represent emission reductions or emission avoidance,for instance by destroying methane generated at landfills or meeting energy demand with solar or wind instead of fossil fuels.Avoided deforestation projects are another example of an emission avoidance project.Carbon credits can also r

268、epresent emission removals from the atmosphere,such as sequestering carbon through afforestation or directly capturing carbon from the air and storing it.Each carbon credit represents 1 tCO2e reduced or removed.Supply of carbon credits is delivered by three main categories of crediting mechanisms:In

269、ternational crediting mechanisms are those administered or managed by an international organization that is established with authority of national governments,such as UN agencies.This category includes mechanisms established under the Kyoto Protocol(including CDM)and Article 6 of the Paris Agreement

270、.iii Governmental crediting mechanisms are those administered by one or more governments,such as the Californian Compliance Offset Program and the Australian Carbon Credit Unit(ACCU)Scheme.i Article 6 of the Paris Agreement provides the framework for international compliance carbon markets;Article 6

271、.4 establishes a centralized mechanism supervised and governed by the United Nations Framework Convention on Climate Change,which is expected to be administratively similar to the CDM of the Kyoto Protocol;Article 6.2,on the other hand,provides a basis for bilateral or plurilateral voluntary coopera

272、tion among countries,which potentially offers flexibility to reduce greenhouse gas emissions through a variety of processes,mechanisms,and standards.Independent crediting mechanisms include those administered by a non-governmental organization,such as Verra and Gold Standard.Additional detail,includ

273、ing definitions and descriptions of project categories,is provided in Annex A.Carbon credits are retired once the benefit has been claimed for voluntary or compliance purposes.Retired credits are a useful proxy for demand for credits,which can stem from a range of drivers,meaning that few sources of

274、 supply can be matched with only one source of demand.However,it is possible to identify four market segments,largely based on demand drivers:1.International compliance.This primarily consists of(i)countries voluntarily purchasing/utilizing credits or“mitigation outcomes”recognized under internation

275、al treaties to help meet their GHG mitigation commitments;and(ii)airlines purchasing credits eligible for meeting their obligations under CORSIA.2.Domestic compliance.This includes companies purchasing credits that are eligible for meeting their obligations under domestic law,usually an ETS or a car

276、bon tax.These may include credits issued under international,governmental,or independent crediting mechanisms,depending on the rules established by respective governments.3.Voluntary,which consists of(mostly private)entities purchasing carbon credits for the purpose of complying with voluntary mitig

277、ation commitments.This buyer group primarily sources credits issued under independent crediting standards,though some entities also purchase those issued under international or governmental crediting mechanisms.38 State and Trends of Carbon Pricing 2024AnnexesChapter 4Chapter 2Chapter 1ForewordExecu

278、tive SummaryChapter 3WORLDBANK.ORG4.Results-based finance refers,in the context of the carbon market,to purchases of carbon credits by governments or international organizations for the purpose of incentivizing climate change mitigation or helping host countries meet national targets.Results-based f

279、inance can also refer to broader payments in return for the achievement of emission reductions or removals,without any transfer of credits or other ownership.The linkages and overlaps across compliance and voluntary markets,as well as international and domestic markets,continue to evolve.67One of th

280、e key features of international compliance markets is the requirement for the credit to be subject to a“corresponding adjustment”an accounting measure performed by national governments under Article 6 of the Paris Agreement to prevent double counting of emissions reductions and removals.This report

281、refers to these as“correspondingly adjusted credits.”International compliance markets must exclusively trade correspondingly adjusted credits,and such credits will potentially be used also within voluntary carbon markets.FIGURE 14Types of carbon crediting mechanisms and market segmentsInternational

282、crediting mechanismse.g.,CDM,Art 6.4Governmental mechanismse.g.,California Compliance Off set ProgramIndependent crediting mechanismse.g.,VCS,Gold StandardSources of SupplyMarket SegmentsCredit purchases aimed at helping countries meet their NDCs and airlines comply with CORSIAInternational complian

283、ce marketsCredit purchases aimed at complying with obligations under carbon taxes,ETSDomestic compliance marketsResult-based fi nanceCredit purchases as public policy tool for incentivizing mitigationVoluntary carbon marketCredit purchases aimed at meeting voluntary targets or commitmentsSource:Adap

284、ted from State and Trends of Carbon Pricing 202239 State and Trends of Carbon Pricing 2024AnnexesChapter 4Chapter 2Chapter 1ForewordExecutive SummaryChapter 3WORLDBANK.ORGfor 15%of total issuances,up from 5%in 2022.This increase has coincided with an increased focus from project developers on cookst

285、ove projects because of the strong health and social co-benefits,and their resilience to poor economic conditions.Nonetheless,recent scrutiny over the potential overestimation of the impacts of cookstove projects highlights the need for more accurate assessment methodologies.70 In terms of regional

286、supply of credits,China and India remain the largest host countries in terms of issuances,with a roughly 15%share each,but with a 40%year-on-year decrease in issuance volumes respectively.Issuances of carbon credits fell for the second consecutive year.Independent crediting mechanism issuances fell

287、by 9%from the previous year.This decline was mainly driven by reduced issuances from the VCS and the American Carbon Registry.Issuances from the main project categories fell in 2023.This trend reflects a range of factors,including project developers delaying credit issuance applications due to assoc

288、iated costs,pending the improvement of market demand and prices,as well as a potential shift in investment and demand away from traditional projects.68 The two largest project categoriesrenewable energy and emission avoidance projects in forestry and land useboth faced a near 50%decrease in issuance

289、s compared to 2022.For renewable energy projects,the number of projects able to deliver credits is declining.New renewable energy projects face challenges to demonstrate financial additionality requirements and many large-scale renewable projects are reaching the end of their crediting periods.In th

290、e case of avoided deforestation projects,reduced issuances could be attributed to weakened market confidence due to continuing concerns of over crediting following prominent criticisms of the integrity of project-level REDD+iivactivities during 2023.69 One project category that saw growth was househ

291、old devices,including clean cookstoves,biodigester systems,and efficient lighting,which increased by 23%(see Figure 15).Household devices now accountii Reducing Emissions from Deforestation and Forest Degradation projects,REDD+encompasses reducing emissions from deforestation and forest degradation

292、in developing countries and includes forest conservation,sustainable management of forests,and enhancement of forest carbon stocks.40 State and Trends of Carbon Pricing 2024Issuances of carbon credits fell for the second consecutive year.AnnexesChapter 4Chapter 2Chapter 1ForewordExecutive SummaryCha

293、pter 3WORLDBANK.ORGFIGURE 15Issuances and retirements by project category in independent crediting mechanisms,2018-2023RetirementsIssuancesRetirementsIssuancesRetirementsIssuancesRetirementsIssuancesRetirementsIssuancesRetirementsIssuances20020350300250200150100500Credits issue

294、d/retired(millions)Figure 15Issuances and retirements by project category in independent crediting mechanisms,2018-2023 Agriculture Chemical processes/industrial manufacturing Energy effi ciency/fuel switching Forestry and land use Household/community devices Renewable energy Others Waste Cumulative

295、 number of non-retired credits(right hand side)Cumulative non-retired credits(millions)8007006005004003002001000YearVolume of issuances and retirements by project category covers the following crediting mechanisms:American Carbon Registry,Climate Action Reserve,Gold Standard and Verifi ed Carbon Sta

296、ndard.Project categorization has been provided by Ecosystem Marketplace.All issuance and retirements data here refers to original issuances,which only include the fi rst time a credit has been issued for a specifi c emission reduction/removal activity to avoid double counting.Original issuances do n

297、ot rely on any previous issuances from other crediting mechanisms.While it takes time for new supply to be realized,alternative approaches to crediting are starting to materialize.The long lead times to generate abatement and issue credits,combined with uncertain and changing demand signals,mean unl

298、ocking new sources of supply takes time.In addition,there is a need to ensure that governments and businesses are ready to participate,while also exploring options for innovative approaches and opportunities to reduce transaction costs.However,these priority areas must be balanced against maintainin

299、g environmental integrity.This highlights the challenge with short-term supply expansions.However,additional sources of carbon credit supply will start to become available in coming years.For example,the World Banks Forest Carbon Partnership Facility(FCPF)has been supporting countries to generate hi

300、gh-integrity carbon credits generated from the preservation and sustainable management of forests in their jurisdictional-scale programs.The 15 participating countries are expected to generate up to 270 million credits by 2028,126 million of which may be available to carbon markets as decided by eac

301、h country.Also,integrating credit markets into sector-level transition plans can mobilize finance at a greater scale.Initiatives like the Energy Transition Accelerator and the Innovative Carbon Resource Application for Energy Transition Project for Uzbekistan(iCRAFT)that support policy-based crediti

302、ng are aiming to generate carbon credits from reductions across the energy sector.The State and Trends of Carbon Pricing:International Carbon Markets 2023 report provides further information on these initiatives.41 State and Trends of Carbon Pricing 2024Volume of issuances and retirements by project

303、 category covers the following crediting mechanisms:American Carbon Registry,Climate Action Reserve,Gold Standard,and Verified Carbon Standard.Project categorization has been provided by Ecosystem Marketplace.All issuance and retirements data here refers to original issuances,which only include the

304、first time a credit has been issued for a specific emission reduction/removal activity to avoid double counting.Original issuances do not rely on any previous issuances from other crediting mechanisms.AnnexesChapter 4Chapter 2Chapter 1ForewordExecutive SummaryChapter 3WORLDBANK.ORGFIGURE 16Annual re

305、gistrations by crediting mechanism type from 2018 to 20232002120222023 Figure 16Annual registrations by crediting mechanism type from 2018 to 2023 Annual registrations1,6001,4001,2001,0008006004002000 Governmental mechanisms Independent mechanisms International mechanism Thailand Voluntar

306、y Emission Reduction Program(5%)Other governmental mechanisms(12%)Australian Carbon Credit Unit Scheme(29%)American Carbon Registry(7%)Climate Action Reserve(4%)Gold Standard(26%)Verifi ed Carbon Standard(17%)The project pipeline is growing for projects with co-benefits,which is an important attribu

307、te for voluntary demand.While project registrations do not necessarily predict future supply(because the scale of issuances from registered projects differs by sector,category,and region),it is a good indicator of activity and interest and can help provide an indication of the changing appetite for

308、certain project types.In 2023,while total project registrations remained stable,registrations of projects for household devices grew,reflecting increased interest in this project category with highly visible co-benefits.As a result,household devices accounted for almost half of all new project regis

309、trations in 2023,making it the largest contributor of new registrations for the first time.Registrations are split mostly equally across independent and governmental mechanisms,with the share of the latter decreasing in recent years.Of the governmental mechanisms,Australias Carbon Credit Unit Scheme

310、 dominates,accounting for nearly 30%of project registrations in 2023 with the majority of new registrations coming from Australian forest-based removal projects(see Figure 16).v Some of these projects had already been actively issuing credits.The relative contribution of different categories is like

311、ly to continue evolving over time as demand and ultimately supply respond to shifts in market preferences.iii A dramatic spike in registrations under the VCS(over 1,000 projects),largely relating to registrations of renewable energy projects in India and China,occurred in 2020.However,a portion of t

312、he projects contributing to the increase in observed registrations in 2020 were not entirely new projects but rather a result of transitioning existing projects to Verras central registry from third-party service providers registries.iii42 State and Trends of Carbon Pricing 2024Annual registrations

313、in independent and international crediting mechanisms have been retrieved by the World Bank and cover the following mechanisms:American Carbon Registry,Clean Development Mechanism,Climate Action Reserve,Gold Standard,and Verified Carbon Standard,Annual registrations in governmental mechanisms were p

314、rovided by the jurisdictions and include registrations from the Alberta Emission Offset System,Australian Carbon Credit Unit Scheme(ACCU),British Columbia Offset Program,Canada Federal GHG Offset System,Joint Crediting Mechanism,Nova Scotia Crediting Mechanism,Quebec Offset Crediting Mechanism,Saita

315、ma Forest Absorption Certification System,Spain Carbon Fund for a Sustainable Economy(FES-CO2)Program,Switzerland CO2 Attestations Crediting Mechanism,Thailand Voluntary Emission Reduction Program,and Washington Crediting Mechanism,AnnexesChapter 4Chapter 2Chapter 1ForewordExecutive SummaryChapter 3

316、WORLDBANK.ORGFIGURE 17Share of annual registrations by project category in independent mechanisms from 2018 to 202343 State and Trends of Carbon Pricing 202420020%80%60%40%20%0 Share of registrations Figure 17Share of annual registrations by project category in independent mech

317、anisms from 2018 to 2023Data on annual registrations by project category in independent mechanisms has been retrieved by the World Bank and covers the following mechanisms:American Carbon Registry,Climate Action Reserve,Gold Standard,and Verifi ed Carbon Standard.Agriculture Waste Others Energy effi

318、 ciency/fuel switching Forestry and land use Household/community devices Renewable energy Chemical processes/industrial manufacturingCDM activities transitioning to the Paris Agreement could add significant supply,which could be used for international compliancealthough the volume of credits is high

319、ly uncertain.Nearly 1,400 CDM activities requested to transition into Article 6,with a large potential for future issuances.Rules are in place for CDM activities to adapt to the new Article 6.4 mechanism,and project participants had until the end of 2023 to apply.Approximately 38%of eligible project

320、 activities and 67%of eligible Programmes of Activities(PoAs)requested to transition.If approved,these projects could issue over 900 million units iv under Article 6.4 for the 2021-2025 period.71 Moreover,an additional 87 million CDM Certified Emission Reductions(CERs)could be issued for pre-2020 em

321、ission reductions,which could be used by countries to achieve their first NDCs.v While this suggests a theoretical upper limit of close to 1 billion CERs and Article 6.4 credits,actual issuances will likely be much lower(perhaps an order of magnitude)after accounting for issuance success,the extent

322、that authorization is obtained,and the successful approval by the host country,among others.The number of reductions and removals under the Article 6 framework will also depend on iv This number consists of 874 million credits from projects using a CDM methodology and 30 million from projects adopti

323、ng an Article 6.4 methodology for the 2021-2025 period during which issuance is possible(thereafter,eligible projects would have to request a renewal of crediting period under Article 6.4 to continue issuing credits).v As per the provisions for the transition of CDM activities into the Paris Agreeme

324、nt,countries may use CDM CERs toward the achievement of their first NDC only.Eligible CERs are those stemming from projects registered after 2013,and only for emission reductions before 2021.The host country must approve the transition,but the use of the CERs is not subject to corresponding adjustme

325、nts.Data on annual registrations by project category in independent mechanisms has been retrieved by the World Bank and covers the following mechanisms:American Carbon Registry,Climate Action Reserve,Gold Standard,and Verified Carbon Standard.Project categories provided by Ecosystem Marketplace.Anne

326、xesChapter 4Chapter 2Chapter 1ForewordExecutive SummaryChapter 3WORLDBANK.ORGthe decisions made by project operators on whether to transition or follow alternative credit issuance paths.Almost 75%of the potential credit volume is based in Asia(mainly Bangladesh,China,and India),Brazil hosts around 1

327、1%,and notable potential volumes are located in Africa(e.g.,Kenya,South Africa,and Uganda)(see Figure 18).72 More than 50%of the credit potential stems from renewable energy projects,and over 20%from efficient cookstove projects.Host countries now have until December 31,2025,to fulfill Article 6 par

328、ticipation requirementsvi and to communicate to the United Nations Framework Convention on Climate Change(UNFCCC)Secretariat which activities are approved for transition.Thereafter,the UNFCCC Secretariat and the Article 6.4 Supervisory Body will assess applications.73vi These are being a party to th

329、e Paris Agreement,maintaining an NDC,having a designated national authority,providing information on how Article 6 participation contributes to sustainable development,and clarifying which activity types are eligible for Article 6,including how they contribute to NDCs,long-term strategies,and other

330、goals.44 State and Trends of Carbon Pricing 2024India 23%China 21%Others 21%Bangladesh 13%Brazil 11%Kenya 3%Chile 1%Indonesia 2%South Africa 2%Uganda 1%Viet Nam 2%Host CountryCDM Sectoral ScopesMain project typesEnergy Industries 55%22%Wind16%Hydro9%Mixed renewables3%Solar5%OthersEnergy demand26%25%

331、Energy effi ciency households1%Energy effi ciency service7%Waste handling and disposal 5%Fugitive emissions from fuels 4%Chemical industries1%Manufacturing industries1%Aff orestation and Reforestation1%OthersFIGURE 18Potential issuances from 2021-2025 activities that requested transition by host cou

332、ntry and project typeThis figure shows potential issuances from CDM activities that submitted requests to transition to the Article 6.4 mechanism.Data from the UN Environment Programmes CDM Pipeline,available at https:/unepccc.org/cdm-ji-pipeline.Background information from the CDM Registry,availabl

333、e at https:/unfccc.int/process-and-meetings/the-paris-agreement/paris-agreement-crediting-mechanism/transition-of-cdm-activities-to-article-64-mechanismAnnexesChapter 4Chapter 2Chapter 1ForewordExecutive SummaryChapter 3WORLDBANK.ORG3.2 While voluntary retirements have remained relatively stable,the emergence of new compliance markets will likely boost demandRetirements for carbon credits held ste