Suggestions
News & Insights
No results found
07 Nov 2021

COP26 Insights from John Kent: The logical argument for carbon tax

Generic yellow

As the main fanfare of the early days of COP26 settles down it is worth reflecting on some of the highlights so far. The pledge by 100 countries to reduce methane emissions by 30% by 2030 is a notable step forward despite the pledge being non-binding and the fact that China, Russia, and India remain on the sidelines. Methane reduction is important because, over 20 years, it is 84 times as powerful per unit mass as carbon dioxide and it is the second-largest component of global warming after carbon dioxide. I also find Mark Carney's Glasgow Financial Alliance for Net Zero (GFANZ) potentially as ground breaking. Having the right 'financial plumbing' to support energy transition will have real impact. Other areas of progress include commitments on deforestation and movement away from coal, albeit non binding.

One area which has received less airplay than I would have liked is Carbon Taxation. This, in my mind, has the potential to be the largest weapon in the armoury required to achieve Net Zero by 2050. Other than comments by Mark Carney on his vision of a global carbon tax by 2030, headlines and discussions on this topic have been muted. Potential reasons for the relative silence in this area may lie in the fact that to coordinate a carbon tax across the globe is a very tough task. Who pays what? How can you ensure equity between rich and poor countries? How do you deal with cross border transactions? Also, some politicians may fear constituency rejection if a broad carbon tax scheme is seen to be unfair.

About 45 nations have some element of a carbon tax and according to the World Bank c.US$70bn was raised globally from carbon pricing schemes in 2020. In the same period global carbon emissions from fossil fuels were 36.4 billion tonnes. A global carbon tax with an average of US$10 per tonne, mixing a low-level entry cost for all parties and a much higher cost for developed nations would certainly result in many positive behavioural and funding changes. Firstly, the additional cost burden on the user of carbon will result in reducing their demand. Increasing carbon cost over a known period will see demand drop systemically. Secondly, such a scheme has the potential to produce the scale of funds required for the energy infrastructure of tomorrow. Thirdly, it will support funding for developing nations to enable their energy transition plans.

Yes, implementing a global carbon tax scheme is a tough ask, however, it has game-changing potential.

Related Blogs

You might also like

Microsoft Teams image 40
Press Releases & Featured Stories
Overcoming supply challenges with collaboration
Cerianne Cummings, our Offshore Wind Market Director, shares with Energy Global how the offshore wind market could mitigate some of the supply chain challenges
AI in the oil and gas industry
Insights & Opinions
The great AI debate in the oil and gas industry: balancing job loss concerns with the thriving potential of AI applications
Wassim Ghadban, our VP, Global Innovation and Digital Engineering, analyses the concerns and opportunities that AI brings to the Oil & Gas sector
Ed Reynolds Banner and Thumbnail
Press Releases & Featured Stories
The impact innovation and technology can have on the team environment
Ed Reynolds, our VP of Completions, Commissioning & Start-Up in the Americas, speaks to Energy Voice about how trust within a team is key to the success of a project
PDOP-Mobile-Robot-2
Insights & Opinions
Laser scanning capabilities taken to the next level with the latest robot technology
Introducing PDOP, our first Boston Dynamic Spot robot
Twinhub Floating Wind from Hexicon
Insights & Opinions
Twinhub Floating Wind from Hexicon launches Celtic Sea supply chain
Floating wind farm england launches celtic sea supply chain
DSC01184 copy
Insights & Opinions
Kent: a new company at the heart of energy transition
Digital Twin is becoming the new norm for engineering and construction to reduce the cost of capital projects
Kent Aramco Digital Twin
Insights & Opinions
Reimagine Project Execution in a Digital Twin Environment
Digital Twin is becoming the new norm for engineering and construction to reduce the cost of capital projects
Remote operations of Oil Gas facilities
Insights & Opinions
The move from local control to remote operations of Oil & Gas facilities
Remote operations of Oil & Gas facilities
Offshore operations
Press Releases & Featured Stories
Bring your weird to work for Kent
Our CEO John Gilley speaks to Energy Voice
Craft 3
the energy within.
Contact

By using our website you consent to all cookies in accordance with our Privacy Policy.

×