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Global carbon pricing revenue in 2021 increased by almost 60 percent from 2020 levels, to around $84 billion, providing an important source of funds to help support a sustainable economic recovery, finance broader fiscal reforms, or invest in communities as part of the low-carbon transition future, according to the World Bank’s annual “State and Trends of Carbon Pricing” report released on 24 May 2022.

The report, which presents the latest carbon pricing developments around the world, finds that there are 68 direct carbon pricing instruments operating: 36 carbon taxes and 32 Emissions Trading Systems (ETSs). Four new carbon pricing instruments were implemented since the release of the 2021 State and Trends of Carbon Pricing report: one in Uruguay and three in North America (Ontario, Oregon, New Brunswick). Countries announcing plans for new carbon pricing policies include Israel, Malaysia, and Botswana.

Carbon prices hit record highs in many jurisdictions, including the European Union, California, New Zealand, the Republic of Korea, Switzerland and Canada. However, the report finds that less than 4 percent of global emissions are currently covered by a direct carbon price in the range needed by 2030 to meet the temperature goal of the Paris Agreement.