Governments around the world at the cost of carbon emissions have raised a combined $84 billion in 2021, but the World Bank has warned that this is “not enough” to limit global warming.

The latest World Bank report this week said countries that charge companies for their emissions are generating 60% more money than the previous year, as prices rise and more countries deploy carbon pricing schemes.

The global carbon pricing revenue figures come as the European Union looks to expand its carbon emissions trading scheme to fund its exit from Russian energy.

The EU operates the largest emissions trading scheme by value, receiving more than 40% of all carbon pricing revenue last year. Buyers of allowances are allowed to emit one ton of carbon.

The EU’s move to raise another 20 billion euros through the scheme has angered green groups, as the sale of more carbon permits would allow about 250 million tonnes of carbon dioxide to be released.

According to the EU plan, carbon prices rose to more than 80 euros a ton by the beginning of this year, up from around 30 euros a ton a year ago.

The World Bank report said a “significant increase” in cash from such schemes showed the potential to incentivise companies to decarbonise, but it also warned that the ideal 1.5C to stop global warming would not be enough. Paris Agreement. The Earth has warmed by about 1.1 degrees Celsius since pre-industrial times.

The report notes that only four new carbon pricing tools were implemented last year. “Despite record high prices in some jurisdictions, prices in most jurisdictions are still well below levels needed to meet the Paris Agreement temperature targets,” it said.

A total of 68 regions are now putting a price on carbon to help reduce emissions and meet their national climate goals, or implement similar emissions trading schemes.

In 2021, emissions trading system (ETS) revenue exceeded carbon tax for the first time. Under a carbon tax system, the government sets a price per metric ton of carbon to incentivize companies to reduce emissions. Under the ETS, the government places a cap on the amount of greenhouse gases that can be emitted. Companies often have the option of purchasing additional quotas or selling the remaining quotas to other companies.

The World Bank said the rise in ETS revenue reflects a faster rise in carbon prices in these schemes than with fixed-price instruments such as carbon taxes. The second factor, it said, was an increase in government auctions of quotas, rather than allocating quotas for free as in China.

Although China’s ETS is the largest scheme in the world, carbon allowances are allocated to companies for free as measured by the emissions covered, so its scheme generates no revenue.

Overall, carbon pricing schemes cover about 23 percent of total greenhouse gas emissions. But only 4% of global emissions are currently covered by a carbon price high enough to reduce the emissions needed to meet the 2030 climate goals.

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Earlier this year, a report by the United Nations Intergovernmental Panel on Climate Change found that global greenhouse gas emissions would need to be cut by 43 percent by 2030 compared with 2019 to meet the goals of the Paris climate agreement.

The IPCC report, compiled by 278 scientists in 195 countries, found that without immediate action, global temperatures could rise by 3.2 degrees Celsius by the end of the century.

The World Bank notes that direct carbon pricing schemes such as carbon taxes and ETS have so far been concentrated in high- and middle-income economies. It said indirect schemes such as fuel taxes were more common than direct carbon pricing, including in many developing countries.

The U.S. is historically the world’s largest emitter of greenhouse gases, and only California, Washington and Oregon have direct carbon pricing plans.

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