News ID: 314017
Published: 0328 GMT June 18, 2021

IMF urges top polluters to adopt carbon price floor

IMF urges top polluters to adopt carbon price floor

The IMF on Friday issued a report calling for the world's top polluters to adopt an international carbon price floor, arguing it offered a "realistic prospect" to combat climate change.

The multilateral agency said that carbon pricing was now widely accepted as the most important policy tool to achieve the drastic emissions cuts required to limit global warming to two degrees Celsius by 2050, AFP reported.

But right now, four-fifths of emissions remain unpriced and the global average carbon price is just $3 a ton – far below the level needed to incentivize energy efficiency and redirect innovation towards green technologies.

The report modeled different scenarios and said that a three-tier price floor of $75, $50, and $25 per ton for advanced, high, and low-income emerging markets respectively could help achieve a 23 percent reduction in emissions by 2030.

That example would involve just six participants: Canada, China, the European Union, India, the United Kingdom and the United States.

The report suggested the scheme could be launched by the G20 before being expanded to others.

The initial goal would be to meet the Intergovernmental Panel on Climate Change's target of reducing emissions between one quarter to a half by the end of this decade.

   
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