Introduction to carbon pricing

Social cost of carbon (SCC)

Compliance pricing: Emissions Trading System (ETS) and carbon tax

European Union Emissions Trading System (EU ETS)

As the world’s largest carbon emitter, China has set its own climate targets and establishing domestic tools to encourage mitigation. One such tool is the national Emissions Trading Scheme (ETS) established in 2019. What is it, how does it work and what are the latest developments?

The United States does not have a federal carbon pricing schemes (ETS or taxes) in place, but some individual States have implemented their own compliance systems. Here we explore the California cap-and-trade, Regional Greenhouse Gas Initiative (RGGI) and the Washington State cap-and-investment scheme. Click on the “Materials” tab to see module content.

Carbon taxes are a type of compliance scheme that puts a price on carbon. If done well, this tool can be effective and efficient in incentivising mitigation and generate much-needed funding. But ‘tax’ is an unpopular word and there is generally a lack of awareness and misperception about carbon taxes. What is the state of carbon taxes around the world, and what are the pros and cons of these schemes? Click on the “Materials” tab to see module content.

Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA)

European Union Carbon Border Adjustment Mechanism (EU CBAM)

Introduction to the Voluntary Carbon Market (VCM)

VCM: a brief history

VCM: supply-side integrity and Integrity Council for the Voluntary Carbon Market (ICVCM)’s ten Core Carbon Principles (CCPs)

VCM: demand side and Voluntary Carbon Market Integrity Initiative (VCMI)’s Claims Code

ICROA was one of the first industry-led accreditation programmes that aimed to ensure high quality carbon credits and offsetting practices in the VCM. In recent years, its work began to overlap with newer initiatives such as the TCFD, SBTi, ICVCM and VCMI. What is ICROA, how does it work and is it important? Click on the “Materials” tab to see module content.

Standards and registries form the backbones of the VCM. Evolving over decades and building on best practices, these organisations and frameworks are seen as instrumental in bringing much-needed integrity and due process to carbon markets. Who are they, how do they work, and what are the key challenges and opportunities facing them? Click on the “Materials” tab to see module content.

As the interest in carbon markets, in particular the VCM, took off in recent years, so did the need for independent quality assurance on carbon credits. Since 2020, carbon credit rating agencies have entered the scene, each claiming a unique offering. How do they produce ratings, are they helpful and how do they compare to each other? Click on the “Materials” tab to see module content.

Across the world, Indigenous Peoples (IPs) and local communities (LCs) are hugely diverse and important. They are the planet’s best stewards of their land and nature, standing front and centre in the fight against climate change and environmental degradation. Yet they remain marginalised and often lack rights, representation and access to much-needed resources. Can environmental markets – such as carbon markets – help? What are the complexities and opportunities for IPs and LCs? Click on the “Materials” tab to see module content.

BVCM refers to actions companies can take to invest in mitigation outside of their value chains. It is a concept that has been gaining traction in recent years as part of the movement for businesses to shift from an ‘offsetting’ model to a ‘contribution’ model. Why is BVCM important, how would it work and what will it take to scale? Click on the “Materials” tab to see module content.

UK Woodland Carbon Code (WCC)

UK Peatland Code