The price of carbon is too low to meet global climate change targets, according to a survey of market experts.
Members of the International Emissions Trading Association (IETA) said they believed that carbon should be priced at €40 a tonne, one third higher than their estimate in a similar survey last year.
However, this contrasts with their expectations for prices in major carbon markets, which ranged between €6 and €15 a tonne by 2020.
IETA chief executive Dirk Forrister said: ‘The gap between price expectations and the price required to achieve the Paris goals reflects the difference between ambition and reality.’
Jonathan Grant, director at PwC, said: ‘With such low carbon prices, some will question whether the policy is working and changing business decisions or if it has become just an administrative burden on companies.’
More than 80% of IETA members predicted that carbon markets would expand compared with 58% last year – before the Paris Agreement. They predicted new schemes in countries including Brazil, Chile and Japan.
