Emission Systems

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[mk_dropcaps style=”simple-style”]T[/mk_dropcaps]HERE ARE ABOUT 40 countries and more than 20 cities, states and provinces trying to reduce greenhouse gas emissions by implementing different forms of carbon pricing. Combined, these jurisdictions have put a price on 12 per cent of the world’s carbon. According to the World Bank, these carbon pricing initiatives are now valued at $50 billion. (For more on how these systems work, see “The price is right”.) This map shows what regions or countries have a price on carbon and indicates which mechanism (carbon tax or cap-and-trade or other) they’re using, along with brief summaries of the provincial approaches in Canada and highlights of international methods around the globe.

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EUROPE

Scandinavian countries were the first to issue carbon taxes in the early 1990s. Sweden’s carbon tax, at $168 per tonne, is the highest in the world. By 2005, the European Union founded the world’s largest emissions trading scheme, more commonly known as cap-and-trade.[/vc_column_text][/vc_column][vc_column width=”1/3″][vc_column_text disable_pattern=”true” align=”left” margin_bottom=”0″]

ASIA

China launched a pilot cap-and-trade system in seven cities in 2013, and has plans to create a national system by 2016. South Korea, meanwhile, launched its cap-and-trade system in 2015. It covers 525 businesses and accounts for about 60 per cent of the country’s emissions.[/vc_column_text][/vc_column][vc_column width=”1/3″][vc_column_text disable_pattern=”true” align=”left” margin_bottom=”0″]

SOUTH AMERICA

In the fall of 2014, Chile approved a carbon tax of USD$5 per tonne of CO2. In 2018, this tax will be applied to power generators with a capacity greater than 50 megawatts. Meanwhile, Brazil plans to introduce a carbon-pricing system soon.[/vc_column_text][/vc_column][/vc_row][vc_row][vc_column width=”1/3″][vc_column_text disable_pattern=”true” align=”left” margin_bottom=”0″]

UNITED STATES

Connecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, New York, Rhode Island and Vermont are all part of the first market-based regulatory program in the U.S., which is essentially a cap-and-trade system on the power sector. California, meanwhile, is part of the WCI with Quebec and B.C.[/vc_column_text][/vc_column][vc_column width=”1/3″][vc_column_text disable_pattern=”true” align=”left” margin_bottom=”0″]

SOUTH AFRICA

Expected to begin this year, South Africa’s carbon tax will cover all direct GHG emissions from fuel combustion as well as non-energy industry emissions. The proposed rate is about $12 Canadian per tonne, and would increase by 10 per cent each year to 2019.[/vc_column_text][/vc_column][vc_column width=”1/3″][vc_column_text disable_pattern=”true” align=”left” margin_bottom=”0″]

NEW ZEALAND

In the fall of 2014, Chile approved a carbon tax of USD$5 per tonne of CO2. In 2018, this tax will be applied to power generators with a capacity greater than 50 megawatts. Meanwhile, Brazil plans to introduce a carbon-pricing system soon.[/vc_column_text][/vc_column][/vc_row][vc_row][vc_column width=”1/3″][vc_column_text disable_pattern=”true” align=”left” margin_bottom=”0″]

QUEBEC

Quebec joined the WCI in 2008, but it wasn’t until 2013 that the province made it mandatory for industrial- and energy-sector businesses that emit more than 25,000 tonnes of CO2 a year to use the cap-and-trade system. In 2014, it officially linked its system to the WCI. Between 2015 and 2020, fossil fuel distributors will be added to the initiative.[/vc_column_text][/vc_column][vc_column width=”1/3″][vc_column_text disable_pattern=”true” align=”left” margin_bottom=”0″]

ONTARIO

In April 2015, Premier Kathleen Wynne announced the province would join Quebec and California in the WCI cap-and-trade market, the largest carbon market in North America. Details of the province’s approach were to be finalized within six months (they had not been revealed at press time in November 2015).[/vc_column_text][/vc_column][vc_column width=”1/3″][vc_column_text disable_pattern=”true” align=”left” margin_bottom=”0″]

ALBERTA

Although it’s currently under review by the new NDP government (see “At issue,” page 16), the Specific Gas Emitters Regulation was created in 2007 as an intensity-based approach to improve efficiency without capping total emissions. In 2015, the government introduced a climate plan that included a carbon price across all sectors, including coal and oil, as well as a cap on emissions. The carbon price will start at $20 per tonne in 2017, and increase to $30 per tonne in 2018.[/vc_column_text][/vc_column][/vc_row][vc_row][vc_column width=”1/3″][vc_column_text disable_pattern=”true” align=”left” margin_bottom=”0″]

BRITISH COLUMBIA

British Columbia implemented a “revenue neutral” carbon tax in 2008. This tax sees every dollar the government reaps through it returned to taxpayers in reductions to other taxes. The system ensures those who use carbon pay for it. And it appears to work: between 2008 and 2014, fuel consumption in B.C. dropped by 16 per cent, while the Canadian average increased by three per cent. B.C. is also part of the Western Climate Initiative (WCI), a non-profit corporation that helps governments implement emissions trading programs.[/vc_column_text][/vc_column][vc_column width=”1/3″]
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—Tom Hall

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Read more stories from the Winter 2016 issue of Energy Exchange magazine[/mk_button][/vc_column][/vc_row]