Editing IPCC:AR6/WGIII/Chapter-2 (section)

==== 2.8.3.1 National and Regional Carbon Pricing ====

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Carbon prices – such as carbon taxes and GHG emissions trading schemes (ETSs) – are among the most widely used climate policy instruments across the globe, together with technology support instruments ( [[#IRENA--2018|IRENA 2018]] ). As of May 2020, there were 61 carbon pricing schemes in place or scheduled for implementation, consisting of 31 ETSs and 30 carbon tax regimes, covering 12 GtCO 2 -eq or about 22% of annual global GHG emissions ( [[#World%20Bank--2020|World Bank 2020]] ). The performance of carbon pricing in practice varies by countries and sectors, and depends on the policy environment ( ''robust evidence'' , ''high agreement'' ).

The European Union Emissions Trading Scheme (EU ETS), the longest-standing regional climate policy instrument to date, has reduced emissions, though the estimates of the amount vary by study, by country, and by sector; ranging from 3–28% ( [[#McGuinness--2008|McGuinness and Ellerman 2008]] ; [[#Ellerman--2010|Ellerman et al. 2010]] ; [[#Abrell--2011|Abrell et al. 2011]] ; [[#Anderson--2011|Anderson and Di Maria 2011]] ; [[#Egenhofer--2011|Egenhofer et al. 2011]] ; Petrick and Wagner 2014; [[#Arlinghaus--2015|Arlinghaus 2015]] ; [[#Martin--2016|Martin et al. 2016]] ). The EU ETS avoided emitting about 1.2 GtCO 2 between 2008 and 2016 (3.8%), almost half of what EU governments promised to reduce under their Kyoto Protocol commitments ( [[#Bayer--2020|Bayer and Aklin 2020]] ).

China’s emission trading pilots have resulted in a decline in carbon intensity in the pilot provinces by adjusting the industrial structure ( [[#Zhou--2019|Zhou et al. 2019]] ). The Regional Greenhouse Gas Initiative (RGGI) in the USA has induced leakage in emissions through increases in electricity generation in surrounding non-RGGI areas, but it has led to the reduction of emissions by way of changes in the fuel mix from coal to gas ( [[#Fell--2018|Fell and Maniloff 2018]] ). Actual emissions declined in six of the 10 ETSs for which data is available, although other factors, such as the 2009 recession, have had significant impacts on those emissions as well ( [[#Haites--2018|Haites et al. 2018]] ).

The evidence of environmental effectiveness of carbon taxes in Western European countries is varied depending on country and study ( ''robust evidence'' , ''high agreement'' ). A significant impact is found in Finland but insignificant impacts are found in Denmark and the Netherlands, and there are mixed results for Sweden ( [[#Lin--2011|Lin and Li 2011]] ; [[#Brännlund--2014|Brännlund et al. 2014]] ). Only six of the 17 taxes, where data are available, have reduced actual emissions subject to the tax. Tax rates tend to be too low in many cases and the scale and frequency of the rate changes has not been sufficient to stimulate further emissions reductions ( [[#Haites--2018|Haites et al. 2018]] ).

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