EEPS special issue on “Carbon Pricing in East Asia”

Abstract

Announcements of carbon neutrality, i.e. net zero emissions, have become the norm in the international community. Given the unprecedented severe weather in many parts of the world, nations have started to declare carbon neutrality goals. In 2019, the European Union (EU) announced the goal of carbon neutrality by 2050. In September 2020, the Chinese government also announced a carbon neutrality goal by 2060. In October 2020, both the Japanese and Korean governments declared a goal of carbon neutrality by 2050. After winning the presidential election, the new US president Biden also announced a goal of carbon neutrality by 2050.Obviously, there is no free lunch in achieving carbon neutrality. Carbon neutrality comes with nonnegligible costs. According to the estimate of the Committee on Climate Change, reaching net zero emissions by 2050 could cost up to 1-2% of GDP per year by 2050 in the UK Ekins (2019). Therefore, we must find a way to reduce the costs of carbon mitigation. Economic theory suggests that the use of market mechanisms, i.e., carbon pricing, is one answer. In fact, many developed countries have adopted carbon pricing systems such as emissions trading schemes (ETS) or carbon taxes.The EU introduced its carbon market, known as the European Union Emissions Trading Scheme (EU ETS), in 2005. In the United States, 10 states in the northeast implemented the Regional Greenhouse Gas Initiative (RGGI) in 2009. New Zealand has also adopted an ETS. This trend has reached other parts of the world. In 2010, the Tokyo Metropolitan Government introduced the first ETS in Asia (Abe and Arimura 2021). In Japan, Saitama Prefecture, which is next to Tokyo, introduced an This special issue is based on the thematic session of "Carbon Pricing in East Asia" at the 9th annual congress of Asian Association of Environmental and Resource Economics in Beijing, 2019. We are grateful for the comments from the participants. Toshi Arimura is grateful to the Environment Research and Technology Development Fund (2-1707 and 2-2008) of the Environmental Restoration and Conservation Agency.

Implications of Deglobalization on Energy and Carbon Neutrality in Asia and the Pacific Region

“…Thus, adopting carbon pricing, such as carbon taxes or emissions trading, has become even more important. In this sense, China, Japan, South Korea, and Singapore can share their experiences of carbon pricing (Arimura et al ., 2021).…”