Publication: From the Ground Up: A Decade of Lessons on Carbon Pricing
Loading...
Date
2021-07-27
ISSN
Published
2021-07-27
Author(s)
Editor(s)
Abstract
The World Bank’s partnership for market readiness (PMR), through grant support and technical assistance, supported 23 emerging economies and developing countries in building their institutional and human capacities to design, institute, and implement carbon pricing instruments, such as emission trading systems, carbon taxes, and or carbon crediting mechanisms along with underlying infrastructure such as monitoring, reporting and verification (MRV) and registry systems. As the PMR winds down and its successor - the partnership for market implementation (PMI) - becomes operational in 2021, the time is opportune to take stock of and analyze key lessons learned from the decade of PMR experience. This report draws lessons from the PMR’s decade-long country, technical work, and policy analysis work programs and relates the insights captured through its extensive country participant consultation process, its online surveys, and feedback from its contributing country partners and World Bank task teams. The lessons documented in this report are expected to provide practical insights for other developing countries planning to design and implement carbon pricing initiatives. In addition, the lessons learned on the PMR process, as well as the grant implementation process, are likely to help similar initiatives, including the PMI, to adopt improved program design and governance options that support efficient funds allocation, deployment, and implementation.
Link to Data Set
Citation
“Partnership for Market Readiness. 2021. From the Ground Up: A Decade of Lessons on Carbon Pricing. © World Bank. http://hdl.handle.net/10986/36021 License: CC BY 3.0 IGO.”
Associated URLs
Associated content
Other publications in this report series
Journal
Journal Volume
Journal Issue
Related items
Showing items related by metadata.
Publication Crediting Mechanisms Overview(World Bank, Washington, DC, 2011-12)This document provides a summary assessment of (presented) scaled-up crediting instruments as well as existing project-based crediting schemes against a number of important general characteristics of such instruments. Its purpose is to provide insights that may inform the design and use of possible scaled-up crediting instruments. This summary assessment begins with an examination of proposals for scaled-up crediting mechanisms. It considers existing crediting instruments, that is, (i) Kyoto project mechanisms (clean development mechanism (CDM) and joint implementation (JI)); and (ii) voluntary emission reductions (VER) schemes (in the non-compliance and voluntary markets). The characteristics (or issues) covered are: (i) national and international circumstances for market-based mechanisms and how these interact; (ii) coverage and boundary setting; (iii) participation and incentives for participation; (iv) caps, baselines, and allocations (or issuance); (v) market integrity and credibility; (vi) monitoring, reporting, and verification (MRV); (vii) program authority and administration; and (viii) potential scaling up modalities.Publication Options and Guidance for the Development of Baselines(World Bank, Washington, DC, 2013-10)Developed under the auspices of the Partnership for Market Readiness (PMR) and with advice and input from its Baselines Working Group, this document offers guidance and options for the development of emissions baselines, a key component for assessing the emission reductions in in both market and non-market based mechanisms. In the context of this document, a baseline refers to a scenario that describes expected or desired greenhouse gas emissions levels and that can be used as a basis for determining the amount of emissions reductions achieved as the result of a crediting, trading, or other mechanism. This document is divided into two parts. Part one (sections two and three) presents the context for emissions baselines, introduces key concepts and terms, and describes principles, considerations, and potential trade-offs that can inform decisions in the development of robust and transparent baselines. Part two provides a step-by-step description of how guidance users , a term we use here for those using this guidance, can develop baselines. Part two begins with a brief description of options for baseline development and approval, and proceeds in six further sections (5-10) to present options to define and update baselines. In the future, this document will be supplemented by additional documents illustrating how the guidance presented here can be applied to specific market or non-market mechanisms involving a variety of economic sectors and GHG emission sources. Finally, this document is intended to be dynamic. Over time, as experience is gained and consensus emerges on best practices, this document may evolve to provide more specific guidelines, where and as appropriate.Publication The Nuts and Bolts of Baseline Setting(World Bank, Washington, DC, 2012-08)This document provides an overview of baseline setting for greenhouse gas (GHG) crediting mechanisms. The first section briefly explains the general purpose and objectives of setting a crediting mechanism baseline. The second section summarizes key policy considerations in defining and setting baselines. The final section covers important technical elements of baselines and provides an overview of various methods that can be used to estimate baseline emissions. The main purpose of this technical note is to examine key issues for baseline setting in the context of scaled-up crediting mechanisms. Many of the technical and policy considerations presented here, however, are relevant to existing project-based crediting mechanisms as well, and the discussion takes into account concepts developed and experience gained under these mechanisms. In addition, most of the concepts and examples presented here are relevant to setting baselines in the energy and industry sectors. Where relevant, however, examples from other sectors, including forestry and land-use, are used to illustrate important ideas.Publication Lessons Learned from Linking Emissions Trading Systems(World Bank, Washington, DC, 2014-02)In support of the partnership for market readiness work on helping the emergence of credible, consistent, and compatible market-based infrastructure across countries, this report reviews the lessons learned from linking greenhouse gas emissions trading systems. Two emissions trading systems (ETS) are linked if a participant in one system can use a compliance instrument (allowance or credit) issued by the administrator of either system for compliance. This report focuses on links that enable participants of both ETS to use compliance instruments from either system (bilateral links). The linked systems can adopt common compliance instruments. Or each system can retain its own compliance instruments and accept those from either ETS for compliance, possibly subject to restrictions. A bilateral link offers three potential benefits. First, it can make an ETS a viable policy option for a jurisdiction where an independent ETS will be infeasible for technical or cost reasons. Second, a bilateral link can reduce the total cost of achieving the combined emissions caps of the linked ETS. Third, a bilateral link can enhance the operation of the market for the compliance instrument(s). Section one gives background information. Section two presents the types of links an ETS can establish and discusses the potential benefits and risks of linking. The requirements for a bilateral link between two ETS are summarized in section three. How to implement a bilateral link is discussed in section four.Publication Designing Accreditation and Verification Systems(World Bank, Washington, DC, 2019)Carbon pricing instruments (CPIs) involve large legal and financial interests. Trust in the accuracy and integrity of the reported data is therefore a prerequisite for a well-functioning instrument. To ensure accuracy and integrity of data, a robust monitoring, reporting, and verification (MRV) system is essential. Verification is critical to enhance trust in a carbon pricing system. Where systems have large financial implications, participation is voluntary, or international exchange of units is planned, this trust is paramount for successful implementation. This guidebook aims to help regulators to better understand their options in designing a verification system tailored to their specific needs and circumstances.
Users also downloaded
Showing related downloaded files
Publication Global Economic Prospects, June 2024(Washington, DC: World Bank, 2024-06-11)After several years of negative shocks, global growth is expected to hold steady in 2024 and then edge up in the next couple of years, in part aided by cautious monetary policy easing as inflation gradually declines. However, economic prospects are envisaged to remain tepid, especially in the most vulnerable countries. Risks to the outlook, while more balanced, are still tilted to the downside, including the possibility of escalating geopolitical tensions, further trade fragmentation, and higher-for-longer interest rates. Natural disasters related to climate change could also hinder activity. Subdued growth prospects across many emerging market and developing economies and continued risks underscore the need for decisive policy action at the global and national levels. Global Economic Prospects is a World Bank Group Flagship Report that examines global economic developments and prospects, with a special focus on emerging market and developing economies, on a semiannual basis (in January and June). Each edition includes analytical pieces on topical policy challenges faced by these economies.Publication Global Economic Prospects, January 2025(Washington, DC: World Bank, 2025-01-16)Global growth is expected to hold steady at 2.7 percent in 2025-26. However, the global economy appears to be settling at a low growth rate that will be insufficient to foster sustained economic development—with the possibility of further headwinds from heightened policy uncertainty and adverse trade policy shifts, geopolitical tensions, persistent inflation, and climate-related natural disasters. Against this backdrop, emerging market and developing economies are set to enter the second quarter of the twenty-first century with per capita incomes on a trajectory that implies substantially slower catch-up toward advanced-economy living standards than they previously experienced. Without course corrections, most low-income countries are unlikely to graduate to middle-income status by the middle of the century. Policy action at both global and national levels is needed to foster a more favorable external environment, enhance macroeconomic stability, reduce structural constraints, address the effects of climate change, and thus accelerate long-term growth and development.Publication Business Ready 2024(Washington, DC: World Bank, 2024-10-03)Business Ready (B-READY) is a new World Bank Group corporate flagship report that evaluates the business and investment climate worldwide. It replaces and improves upon the Doing Business project. B-READY provides a comprehensive data set and description of the factors that strengthen the private sector, not only by advancing the interests of individual firms but also by elevating the interests of workers, consumers, potential new enterprises, and the natural environment. This 2024 report introduces a new analytical framework that benchmarks economies based on three pillars: Regulatory Framework, Public Services, and Operational Efficiency. The analysis centers on 10 topics essential for private sector development that correspond to various stages of the life cycle of a firm. The report also offers insights into three cross-cutting themes that are relevant for modern economies: digital adoption, environmental sustainability, and gender. B-READY draws on a robust data collection process that includes specially tailored expert questionnaires and firm-level surveys. The 2024 report, which covers 50 economies, serves as the first in a series that will expand in geographical coverage and refine its methodology over time, supporting reform advocacy, policy guidance, and further analysis and research.Publication Global Economic Prospects, January 2024(Washington, DC: World Bank, 2024-01-09)Note: Chart 1.2.B has been updated on January 18, 2024. Chart 2.2.3 B has been updated on January 14, 2024. Global growth is expected to slow further this year, reflecting the lagged and ongoing effects of tight monetary policy to rein in inflation, restrictive credit conditions, and anemic global trade and investment. Downside risks include an escalation of the recent conflict in the Middle East, financial stress, persistent inflation, weaker-than-expected activity in China, trade fragmentation, and climate-related disasters. Against this backdrop, policy makers face enormous challenges. In emerging market and developing economies (EMDEs), commodity exporters face the enduring challenges posed by fiscal policy procyclicality and volatility, which highlight the need for robust fiscal frameworks. Across EMDEs, previous episodes of investment growth acceleration underscore the critical importance of macroeconomic and structural policies and an enabling institutional environment in bolstering investment and long-term growth. At the global level, cooperation needs to be strengthened to provide debt relief, facilitate trade integration, tackle climate change, and alleviate food insecurity.Publication Argentina Country Climate and Development Report(World Bank, Washington, DC, 2022-11)The Argentina Country Climate and Development Report (CCDR) explores opportunities and identifies trade-offs for aligning Argentina’s growth and poverty reduction policies with its commitments on, and its ability to withstand, climate change. It assesses how the country can: reduce its vulnerability to climate shocks through targeted public and private investments and adequation of social protection. The report also shows how Argentina can seize the benefits of a global decarbonization path to sustain a more robust economic growth through further development of Argentina’s potential for renewable energy, energy efficiency actions, the lithium value chain, as well as climate-smart agriculture (and land use) options. Given Argentina’s context, this CCDR focuses on win-win policies and investments, which have large co-benefits or can contribute to raising the country’s growth while helping to adapt the economy, also considering how human capital actions can accompany a just transition.