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Emission Trading on a Global Scale: Can the Dream Become a Reality?

Social media card of the podcast "Der Preis ist heiß"

© Die Dezentrale


Emission Trading on a Global Scale: Can the Dream Become a Reality?

Der Preis ist heiß – Der ökonomische Klimapodcast


In the economic climate podcast "The Price is Hot," Benjamin Görlach, along with Johannes Eber and Nils Hesse from Die Dezentrale, discussed global trends and developments in the context of emissions trading and CO₂ prices.

The discussion covered various topics, including progress (largely worldwide), obstacles (especially in the USA at the federal level), and the pace of development (continuous, though perceived as too slow). A focal point was the impact of the energy crisis on the implementation of CO₂ pricing, revealing that very few countries have withdrawn their plans or reduced their ambitions.

Emphasis was also placed on the significant role of the Carbon Border Adjustment Mechanism (CBAM), which has significantly expedited discussions on national CO₂ prices in many countries, surpassing initial expectations.

The question whether this leads to a global uniform CO₂ price or even a global emissions trading system, considered the holy grail of climate economics, was discussed. It was emphasized that such a development will not occur top-down. However, this fact is not considered problematic. Instead, it is observed that substantial progress is being made in many regions based on bottom-up approaches. Cooperation and mutual support characterize the development, with CO₂ prices spreading "instrument by instrument." The effectiveness of CO₂ prices in regions where they are implemented is positively evaluated. Furthermore, the demand for a global CO₂ price considering all countries is deemed unrealistic and unnecessarily high.

For a more in-depth analysis of the provided information, reference is made to the 2023 "State & Trends of Carbon Pricing" report by the World Bank. The presented data and insights predominantly stem from this report, to which the Ecologic Institute and adelphi contributed.


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