In order to achieve the goals of the Paris Agreement, the world must reach net-zero carbon emissions by 2050.
In order to achieve the goals of the Paris Agreement, the world must reach net-zero carbon emissions by 2050. Carbon pricing – recently introduced in Germany for transportation and heating – is viewed by many governments and experts as the most important climate policy instrument. However, a new study shows that carbon pricing has been less effective as a driver of technological change than was previously anticipated.
While the introduction of carbon pricing systems has led to emissions reductions in some countries, they have not significantly stimulated technological change. Bringing about the necessary transformation will require sector-specific promotion of climate-friendly technologies, for example changes in electricity market design and a better charging network for electric cars. These changes require significant investment. Carbon pricing has a disappointing track record in this respect, as shown in a new study by scientists Johan Lilliestam (IASS/University of Potsdam), Anthony Patt (ETH Zurich) and Germán Bersalli (IASS Potsdam). They examined empirical studies on the effects of carbon pricing systems in the European Union, New Zealand, the Canadian province of British Columbia, and the Nordic countries.
"The significant reductions in emissions that we are seeing are being driven not by urgently needed investment in zero-carbon technologies but by operational shifts towards less carbon-intensive applications. But the effect of switching from gasoline to diesel or from coal to gas-fired power generation is practically irrelevant when it comes to achieving climate neutrality", says lead author Johan Lilliestam. Achieving net zero emissions will require more sweeping, systemic changes.
Read more at Institute for Advanced Sustainability Studies E.V. (IASS)
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