OECD’s report, 'Effective carbon rates: pricing CO2 through taxes and emissions trading systems' , analyses the extent to which countries use carbon prices.

The OECD's analysis measured effective carbon rates, which is the price of carbon emissions calculated from taxes and emissions trading systems, in 41 OECD and G20 countries. Together these countries account for 80% of all energy use and carbon emissions.

The report finds that there is a major gap between current carbon pricing policies and what is needed to ensure that carbon is priced even at the lower-end estimate of real climate costs - EUR 30 per tonne of CO2.

A price on carbon is considered an effective tool in limiting greenhouse gases by making polluters pay for emissions but worldwide, carbon prices are very low, or even zero.

Across the 41 countries surveyed in the research, the current carbon pricing gap is 80%.

Across 41 countries, 60% of carbon emissions from energy use are unpriced and when the carbon is priced it is very low.

Only 10% of emissions are priced at an effective carbon rate or exceeding EUR 30 per tonne of CO2.

OECD, secretary general, Angel Gurría, said: ‘This new data shows that even moderate collective action to increase carbon prices can make a significant impact in putting countries on a pathway to a low carbon transition.

‘Pricing carbon, through taxes or emissions trading systems, is one of the most effective tools for reducing CO2 emissions and tackling climate change. Prices can and do trigger reductions of energy use, improvements in energy efficiency and a shift towards cleaner forms of energy. The challenge is in getting the prices right.’

The OECD's report, 'Effective carbon rates: pricing CO2 through taxes and emissions trading systems', is available here.