$100 Carbon Tax Could Prevent Catastrophic Warming

Some of the world's most eminent economists have warned carbon prices will have to jump dramatically if the planet were to avoid dangerous levels of global warming.

According to a report released on Monday by the High-Level Commission on Carbon Prices, which is backed by the World Bank and the International Monetary Fund, a carbon price of up to $40-80 by 2020, and $50-100 per ton by 2030, will be needed to meet the world's climate goals in the most cost-effective manner, Business Green reported.

The current carbon price of the world's largest carbon trading system, the EU Emissions Trading Scheme, is currently hovering at about €6 ($6.70) per ton. This is while the US, under president Donald Trump, has so far rejected calls to introduce a carbon tax.

The commission was appointed at the UN talks in Marrakesh in 2016 to investigate what level of carbon pricing would be needed for the world to meet the climate goals set out in the Paris Agreement of limiting warming to "well below" two degrees. It consists of 13 economists, chaired by Joseph Stiglitz and Nicholas Stern.

It concluded that a "well-designed" carbon price is an "indispensable" element of any strategy that seeks to cut carbon emissions while maintaining economic growth. Prices could remain at the lower range if complemented with other policy instruments to curb emissions, the paper said, although this may not prove the most cost-effective option over the long run.

"The world's transition to a low-carbon and climate-resilient economy is the story of growth for this century," Stiglitz and Stern said in a joint statement.

"We're already seeing the potential that this transformation represents in terms of more innovation, greater resilience, more livable cities, improved air quality and better health. Our report builds on the growing understanding of the opportunities for carbon pricing, together with other policies, to drive the sustainable growth and poverty reduction which can deliver on the Paris Agreement and the Sustainable Development Goals," they added.