S&P Global Ratings Report Warns Carbon Prices to Raise above $100 by 2030
A $100 carbon price could impact the gross national products of many countries.
Even if carbon prices are not predictable, companies that have prepared for increased carbon pricing will be more able to adjust their operations. The S&P Global Ratings report expects some companies will need to invest in projects in the long-term to reduce emissions intensity. Currently, few carbon pricing policies exist, and those that do cover only about a quarter of the world’s emissions. As policies increase, which will vary based on local and economic considerations, carbon prices will too.
According to the report, utilities account for the vast majority of emissions revenue intensity per ton of Scope 1 emissions, followed by materials, energy, and transportation. As policies expand and become more financially impactful to businesses, those that have successfully lowered emissions will have a competitive advantage.
In 2019, Canada established a national minimum price on carbon pollution starting at $20 per tonne and increasing from $10 per tonne to $50 in 2022.
Canada also proposed in a Healthy Environment and a Healthy Economy to increase the price on carbon pollution annually at a rate of $15 per tonne from 2023-2030.