Two recently released reports — one from IHS Markit and one from the Organization for Economic Cooperation and Development (OECD) — indicate countries are using market-based solutions such as carbon pricing to incentivize greenhouse gas (GHG) emission reductions, but the rates are too low to allow cities to achieve the emission reduction goals in the Paris Agreement.
The OECD study discovered that countries' average level of carbon pricing will be about 76.5% lower than what its analysis indicates is needed to make an impact: 30 Euros (about $35 USD) per metric ton of CO2. The study says the pricing gap "is declining at a snail’s pace," having dropped from 79.5% in 2015 and 83% in 2012. At the current pace, the gap between carbon prices and real climate costs will not close until 2095.
The IHS Markit report indicates a carbon price of $40-$80 per metric ton of CO2 is needed to achieve Paris Agreement emissions reduction targets, and France is the only G20 country believed to have a carbon price within the necessary range. Both studies indicate countries need to drastically step up their efforts if they want to meet 2020 emissions targets.