The International Monetary Fund (IMF) issued a report on Friday urging the world’s top polluters to adopt an international minimum carbon price, a measure that offers a “realistic perspective” to combat climate change.
The multilateral body said that today there is a great consensus that the price of carbon is the most important political tool to achieve the drastic cuts in emissions necessary to limit global warming to 2 ° C by 2050.
But right now, four-fifths of emissions remain unlisted, and the global average carbon price is just $ 3 per ton, well below the level needed to incentivize energy efficiency and redirect innovation toward green technologies.
The IMF report evaluated different scenarios and gives the example of an agreement between six participants: Canada, China, the European Union, India, the United Kingdom and the United States.
The fixed price could vary depending on the degree of development of the country: 75 dollars minimum for rich countries; $ 50 for high-income emerging economies; and $ 25 for low-income women.
This plan would make it possible to achieve a 23% reduction in emissions by 2030.
The report suggested that the plan could be launched by the G20 before expanding to other markets.
Putting a price on the ton of carbon that is released into the atmosphere is a way of taxing the most polluting energies and thus incentivizing consumers and companies to use clean energy.
The initial objective would be to meet the goal of the Intergovernmental Panel on Climate Change of reducing emissions by a quarter to a half by the end of this decade.
“Simultaneous action among major emitters to raise carbon pricing would generate collective action against climate change, while decisively addressing concerns about competitiveness,” said Victor Gaspar, director of the tax affairs department of the IMF, and Ian Parry, co-author of the report.
“There is no time to lose in putting such an arrangement in place. Let’s imagine 2030. Let’s make sure we don’t then look back to 2021 and regret the missed opportunity for effective action,” they added.
“Simultaneous action among major emitters to raise carbon pricing would generate collective action against climate change, while decisively addressing concerns about competitiveness,” said Victor Gaspar, director of the tax affairs department of the IMF, and Ian Parry, co-author of the report.
“There is no time to lose in putting such an arrangement in place. Let’s imagine 2030. Let’s make sure we don’t then look back to 2021 and regret the missed opportunity for effective action,” they added.
