WASHINGTON, Oct 19, 2015 – For the first time, an
unprecedented alliance of Heads of State, city and state leaders, with
the support of heads of leading companies, have joined forces to urge
countries and companies around the globe to put a price on carbon.
The call to price carbon comes from the Carbon Pricing Panel – a
group convened by World Bank Group President Jim Yong Kim and IMF
Managing Director Christine Lagarde - to spur further, faster
action ahead of the Paris climate talks. They are joined in this effort
by OECD Secretary General Angel Gurria.
The panel includes German Chancellor Angela Merkel, Chilean President
Michelle Bachelet, French President François Hollande, Ethiopian Prime
Minister Hailemariam Desalegn, Philippines President Benigno Aquino III,
Mexican President Enrique Peña Nieto, Governor Jerry Brown of
California, and Mayor Eduardo Paes of Rio de Janeiro.
These global leaders are calling on their peers to join them in
pricing carbon to steer the global economy towards a low carbon,
productive, competitive future without the dangerous levels of carbon
pollution driving warming. Through strong public policy they are
providing certainty and predictability to the private sector so they can
make long-term investments in climate smart development.
Private sector support comes from US Institutional Investor CalPERS,
ENGIE of France, Mahindra Group of India, and Netherlands-based Royal
DSM, who will help link business needs with public policies through the Carbon Pricing Leadership Coalition, an action based platform that will be officially launched in Paris on November 30, 2015.
“There has never been a global movement to put a price on carbon
at this level and with this degree of unison. It marks a turning point
from the debate on the economic systems needed for low carbon growth to
the implementation of policies and pricing mechanisms to deliver jobs,
clean growth and prosperity,” World Bank Group President Jim Yong Kim said. “The
science is clear, the economics compelling and we now see political
leadership emerging to take green investment to scale at a speed
commensurate with the climate challenge.”
“Finance ministers need to think about reforms to fiscal systems
in order to raise more revenue from taxes on carbon-intensive fuels and
less revenue from other taxes that are detrimental to economic
performance, such as taxes on labor and capital. They need to evaluate
the carbon tax rates that will help them meet their mitigation pledges
for Paris and accompanying measures to help low-income households
vulnerable to higher energy prices,” said Christine Lagarde, Managing Director of the International Monetary Fund.
Around the world, about 40 nations and 23 cities, states and regions
have implemented or are putting a price on carbon with programs and
mechanisms covering about 12 percent of global greenhouse gas emissions.
The number of implemented or scheduled carbon pricing instruments has...
nearly doubled since 2012, reaching an aggregate market value of about $50 billion.
This collective experience is providing us with the tools to take the vital step towards pricing carbon and is captured in FASTER principles
developed by the World Bank Group and OECD, with input from the IMF.
These principles are based on fairness; alignment of policies and
objectives; stability and predictability; transparency; efficiency and
cost-effectiveness; and reliability and environmental integrity
QUOTES
“Low carbon technologies are an element in the fight against
worldwide climate change. With a price for carbon and a global carbon
market, we promote investment in these climate friendly technologies.
Many governments are already putting a price on carbon as part of their
climate protection strategies. We should advance our effort along this
path further so that we can actually reach our goal of maintaining the
two degree upper limit,” said German Chancellor Angela Merkel.
“In Chile we believe in the polluter pays principle. We have
enacted environmental taxes on our transportation and power sector. Both
taxes will be instrumental in cleaner power, and more efficient cars,
which will make our air cleaner, and our climate safer. And the revenue
goes to fund our educational reform,” said Chilean President Michelle Bachelet.
“If we really want to send market signals to enable enterprises to
make their decisions under optimal economic conditions, which may be
optimal ecological conditions, then the issue of carbon prices
inevitably arises as it is the most tangible signal that can be sent to
all economic actors,” said French President François Hollande. “I
am aware of the fears created by this notion of carbon pricing,
particularly among the most carbon- intensive industries, which have
concerns, and rightly so, over their competitiveness. We must therefore
act with resolve. Countries, big countries such as China, are already
setting carbon prices. Europe already has a carbon market.”
"Like many nations, Ethiopia has much to gain from early action on
climate change - and much to lose if we collectively fail to act. We
are rapidly developing a diverse portfolio of renewable energy
resources, have been generating results from large scale programs to
rehabilitate landscapes for increased agricultural productivity,
resilience and carbon storage, and have shown the world that carbon
funds can be put to productive use cutting emissions by regenerating
forest cover, and improving people's lives and livelihoods. A carbon
price can be a win-win, not just for nations like Ethiopia, but for the
entire planet, provided that it is coordinated and its incidence does
not unduly fall on the poor,” said Ethiopian Prime Minister Hailemariam Desalegn.
“Climate change is real. It threatens food and water security, and
contributes to the occurrence of more frequent and more destructive
storms. In our part of the world, whole South East Asian coastal
communities are at a particular risk. They need to be relocated, given
the threats of storm surges, rising sea levels, and even landslides. In
our own country, we are indeed hard pressed to build back better our
vulnerable communities, to support their way of life, and to provide
safer, more sustainable livelihood. We are deeply sympathetic about the
plight of island nations, particularly Kiribati and Tuvalu, which are
likewise in danger due to worsening environmental conditions. Years of
international research show that global greenhouse gas emissions are
intensifying, consequently contributing to the factors that leave so
many at risk. In this vein, developing a price on carbon sets in motion
the shift towards cleaner investments for our peoples. The Philippines
thus believes that this is a step we must all take part in, lest we
collectively suffer the consequences of inaction,” said Philippines President Benigno S. AQUINO III
“The challenge of climate change compels us to rethink and
transform the way we produce and consume. The international community
must advance towards a low-carbon economy, by setting a price on carbon.
In keeping with this goal, Mexico has strengthened its national policy
towards green growth. Among other measures, we have established a fossil
fuel tax which will foster clean technologies. This way we support
international efforts in order to ensure that binding agreements –for
both developed and developing countries– will be concluded at the
upcoming COP 21, scheduled to be held in Paris,” said Mexican President Enrique Peña Nieto.
“We can’t stand idly by as billions of tons of carbon pollution spew into the atmosphere,” said California Governor Edmund G. Brown Jr. “California
has put a price on carbon, but these efforts mean little unless the
world’s government and business leaders join us – and go even further.”
“Rio de Janeiro, like most of Brazil, is already experiencing the impacts of climate change - and we're already taking action," said Rio de Janeiro, Brasil Mayor Eduardo Paes.
"We're
investing heavily in climate-resilient infrastructure, and we're also
committed to slashing carbon emissions across our economy. Putting a
price on carbon will serve to accelerate our efforts to build low-carbon
urban prosperity - not just in Rio, but in fast-growing cities around
the world.”
“Putting a price on carbon is key for ensuring we have credible,
cost-effective action on climate mitigation that will get the world on
the road to a zero net emissions future,” said Angel Gurría, Secretary-General of the OECD.”
While COP21 will be important to set the overall framework for the path
forward, it is domestic policies such as carbon pricing that will guide
us collectively to that future. This Panel will help to provide the
high level leadership that we need to generate greater momentum on
carbon pricing up to and beyond COP21. The OECD is pleased to be engaged
in the Panel and to work with the leaders and partner international
organisations to expand the reach and uptake of carbon pricing. With so
much positive upside to action, why would we not embrace the transition?
“CalPERS supports a price on carbon because we are a financial
institution grounded in economics and focused on the long-term. The
market needs a transparent and consistent price that discourages carbon
emissions, and stimulates low carbon investment opportunities. The goal
is that pricing will catalyze a transition to a lower carbon economy,” said Anne Stausboll, CEO of CalPERS.
“Energy use is the main source of greenhouse gas emissions. Energy
transition, key to keeping to a 2°C rise in temperature on the planet,
has started, and ENGIE wants to lead. In addition to the 2 main pillars
of its transition strategy - scaling up renewable and energy efficiency
solutions and services Worldwide -, ENGIE has decided to stop developing
any new coal generation project (that has not already been legally
engaged). ENGIE has put a price on carbon to drive its investment
decisions: generalizing carbon pricing is crucial to drive and boost low
carbon energy transition everywhere and preserve the planet,” said Gérard Mestrallet, CEO of ENGIE.
"Growth and Sustainability are complementary and not conflicting
goals, both are necessary to achieve a reasonable quality of life for
all. Emerging countries will need to leverage technology to follow a low
carbon growth path while developed nations will need to reduce their
carbon footprint,” said Anand Mahindra, Chairman and Managing Director of Mahindra Group of India.
“We need to prevent a global temperature rise above 2 degrees
Celsius. A meaningful carbon price will provide an economic incentive to
shift from fossil to (bio-) renewable energy and reduce GHG emissions.
DSM enables a low carbon economy by, for example, increasing solar panel
yields and converting crop residue into advanced biofuels. To help us
take the right decisions from both an economic and environmental
perspective, we use an internal carbon price of €50. Business has a
responsibility to take care of the world for next generations,” said Feike Sijbesma, Chairman and CEO of Royal DSM.
