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In 2023, carbon pricing revenues reached a record $104 billion, according to the World Bank’s annual “State and Trends of Carbon Pricing 2024” report released on 21 May 2024. Emissions trading schemes generated majority of this revenue, over half of which funds climate and nature programmes.

There are now 75 carbon pricing instruments in operation worldwide, according to the report.

The report’s findings show large middle-income countries including Brazil, India, Chile, Colombia, and Türkiye are making strides in carbon pricing implementation. While traditional sectors like power and industry continue to dominate, carbon pricing is increasingly being considered in new sectors such as aviation, shipping, and waste. The EU’s Carbon Border Adjustment Mechanism, currently in a transitional phase, is also encouraging governments to consider carbon pricing for sectors such iron and steel, aluminium, cement, fertilisers, and electricity.

“Carbon pricing can be one of the most powerful tools to help countries reduce emissions. That’s why it is good to see these instruments expand to new sectors, become more adaptable and complement other measures,” said Axel van Trotsenburg, World Bank Senior Managing Director.