10th Strategic Dialogue of the Carbon Market Platform - Elisa Lanzi

Presentation from the 10th Strategic Dialogue of the Carbon Market Platform

1. INTERNATIONAL CO-ORDINATION ON
CARBON PRICING APPROACHES
What were our hopes and where are we now?
10
th
Strategic Dialogue
Carbon Market Platform
22October 2025
Elisa Lanzi, Senior Economist & CMP Secretariat Lead,
OECD Environment Directorate

2. 2
Outline
•History of the OECD’s support to CMP
•Different types of international co-ordination on carbon pricing
approaches
•Evolution of selected carbon pricing approaches

3. 3
Historyof OECD support to the Carbon Market Platform
2015 2016 2017 2018 2019 2020
December:
Paris Agreement
June:
G7 Leaders commit
to platform for
strategic dialogue
October:
CMP kick-off event,
Berlin
Proposals for
potential focus of
the CMP
Technical input:
International
coordination on
carbon pricing
approaches
OECD support
1
st
Strategic
Dialogue, Tokyo
Draft scoping
paper:
Areas of activity
for the CMP
2
nd
Strategic
Dialogue, Rome
Revised scoping
paper:
Areas of activity
for the CMP
3
rd
Strategic
Dialogue, Halifax
Technical input:
Competitiveness
and carbon pricing
4
th
Strategic
Dialogue, Paris
Technical input:
Economic and
environmental
benefits of
coordination on
carbon pricing
5
th
Strategic
Dialogue, online

4. 4
Historyof OECD support to the Carbon Market Platform
2021 2022 2023 2024 2025 2026
November:
Glasgow
breakthrough on
Article 6
6
th
Strategic
Dialogue, online
Technical input:
Role of carbon
pricing in the
recovery from
COVID-19
Technical input:
Implementing the
G7 Principles of
High Integrity
Carbon Markets
OECD support
7
th
Strategic
Dialogue, Berlin
Technical input:
Transformative
pathways and
carbon pricing
8
th
Strategic
Dialogue, Tokyo
Technical input:
Interplay between
voluntary and
compliance
carbon markets
9
th
Strategic
Dialogue, Rome
Technical input:
Scaled-up
crediting
approaches
10
th
Strategic
Dialogue, Ottawa
April:
G7 Principles of
High Integrity
Carbon Markets
?
November:
Decisions
supporting full
operationalisation
of Article 6

5. 5
Selected OECD outputs for the Carbon Market PlatformOECD outputs
Carbon pricing and competitiveness
(2019)
•Negative competitiveness effects of
carbon pricing had not come to pass at
the time of the publication.
•Investment decisions more influenced by
e.g. macroeconomic trends and labour
policy.
•There is strong evidence that carbon
pricing can spur innovation and support
long-term competitiveness.
Benefits of carbon pricing co-
ordination (2021)
•Quantifies the environmental and
economic benefits of co-ordinating
on carbon pricing.
•Highlights significant potential cost
savings with varying impacts across
countries and C pricing approaches
Governments’ efforts to shape
carbon credit markets (2025)
•Weak demand in carbon credit
markets undermine efforts to
enhance integrity.
•Governments can clarify credit use
cases and work towards mutually
recognised quality standards.
~50 citations
NEW
>150 citations

6. 6
What makes the OECD support to the Carbon Market
Platform special?
Strategic
perspectives
Analytical work seeks to identify
opportunities and risks –
providing policymakers with
decision-relevant information.
Flexibility
The Platform’s governance
allows it to adapt to changing
circumstances. OECD’s broad
expertise gives the Platform a
wide range of potential focus
areas.
Analytical rigour
The OECD has analytical rigour
and independence. Balanced
and evidence-based outputs
guide other research and policy
debates –as evidenced by
downloads and citations.
Robust foundation for international co-ordination
While analytical work has tackled a range of topics, it has always sought to identify opportunities
for the G7 and partners to strengthen international co-ordination on carbon pricing approaches.
OECD support

7. 7
Outline
•History of the OECD’s support to CMP
•Different types of international co-ordination on carbon pricing
approaches
•Evolution of selected carbon pricing approaches

8. 8
Different types of international co-ordination on carbon
pricing approaches
A da pted from first dedica ted technica l input pa per for CM P
Adapted from first
dedicated technical
input paper for CMP
Facilitate creation of new carbon pricing schemes
Facilitate implementation of internal carbon pricing*
* Carbon prices applied to the evaluation of public investment projects
Phasing out inefficient fossil fuel subsidies
Sectoral approaches to carbon pricing**
International market-based co-operation
** E.g. sectoral approaches for international aviation and maritime shipping
Co-ordinating on minimum carbon prices
Direct linking between carbon markets
Carbon market clubs and carbon pricing clubs
Towards a single global carbon price?
Increasing depth of co
-
ordination

9. 9
Different types of international co-ordination on carbon
pricing approaches
Facilitate creation of new carbon pricing schemes
Facilitate implementation of internal carbon pricing*
Phasing out inefficient fossil fuel subsidies
Sectoral approaches to carbon pricing**
International market-based co-operation
Co-ordinating on minimum carbon prices
Direct linking between carbon markets
Carbon market clubs and carbon pricing clubs
Towards a single global carbon price?
What progress
has been made?

10. 10
Outline
•History of the OECD’s support to CMP
•Different types of international co-ordination on carbon pricing
approaches
•Evolution of selected carbon pricing approaches

11. 11
Evolution international co-ordination:
New carbon pricing schemes
0
10
20
30
40
50
60
70
80
90
0%
5%
10%
15%
20%
25%
30%
35%
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Number of instruments
Coverage of global GHG emissions
GHG coverage Number of instruments
2005-2015:
+6%in global GHG coverage
30new instruments
2015-2025:
+16%in global GHG coverage
41new instruments
Source: Carbon Pricing Dashboard (World Bank, 2025)

12. 12
Evolution international co-ordination:
Fossil fuel support
0
200
400
600
800
1000
1200
1400
1600
1800
20102011201220132014201520162017201820192020202120222023
Fiscal cost of fossil fuel support
(USD billion)
Coal Electricity Natural Gas Petroleum
Notes: The OECD-IEA combined estimate covers 82 countries, resulting from merging IEA price-gap estimates and OECD Inventory estimates
of the fiscal cost of support measures for fossil fuels. Note that increases and decreases in fossil fuel support are, to a large extent, relatedto
international prices of natural gas and oil and may not directly reflect fossil fuel reform efforts.
Source: OECD-IEA inventory of fossil fuel support measures (OECD, 2024)
2010-2015:
-USD 62 billion
in total support
2015-2020:
-USD 69 billion
in total support
2020-2023:
+ USD 587 billion
in total support

13. 13
Net effective carbon rates in 2018-2023:
Declining, despite progress on explicit carbon prices
Notes: Net effective carbon rate = [Fuel excise tax] + [ETS permit price] + [Carbon tax] + [Fossil fuel subsidy].
Data covers pricing instruments that are directly proportional to GHG emissions across 79 countries, which cover approximately 82% of
greenhouse gas emissions globally. Excludes LUCF emissions. Constant prices.
Sources: Carbon Pricing and Energy Taxation database (OECD, 2024)
-5
0
5
10
15
20
201820192020202120222023
EUR per tonne of
CO
2
-
equivalent
Net effective carbon rate
Fuel excise tax
ETS permit price
Carbon tax
Fossil fuel subsidy

14. 14
Evolution international co-ordination:
Sectoral approaches
2015 20252016
ICAO agrees on a
market-based
measure, called Carbon
Offsetting and Reduction
Scheme for International
Aviation (CORSIA)
CORSIA’s
voluntary pilot
phase (2021-23)
triggers no offsetting
requirements, due to drop in
air traffic during COVID-19
CORSIA’s first compliance
phase (2024-26)
could trigger demand for >100 million
ITMOs by 31 January 2028, assuming
participating states fully operationalise
the scheme.
IMO adopts initial strategy on
reduction of GHG emissions
from ships, and lists market-based
measure as potential mid-term measure
2018
Paris Agreement
IMO adopts revised strategy,
specifying that the mid-term measures include a
technical element and an economic element, i.e.
maritime GHG emissions pricing
2023
Decision on IMO
Net-Zero Framework
(incl. pricing mechanism)
delayed by a year
2019
ICAO adopt
CORSIA Emission
Unit Eligibility
Criteria

15. 15
Evolution international co-ordination:
International market-based co-operation
0
100
200
300
400
500
600
700
800
900
1,000
20052006200720082009201020112012201320142015201620172018201920202021202220232024
Carbon credit issuances
(millions)
Independent International Governmental
2005-2015:
CDM and JI boom and bust
2015-2025:
Partial recovery, Article 6 under construction
Source: Carbon Pricing Dashboard (World Bank, 2025)

16. 16
Evolution international co-ordination:
International market-based co-operation
0
100
200
300
400
500
600
700
800
900
1,000
20052006200720082009201020112012201320142015201620172018201920202021202220232024
Carbon credit issuances
(millions)
Independent International Governmental
2005-2015:
CDM and JI boom and bust
2015-2025:
Partial recovery, Article 6 under construction
0
5
10
15
20
25
30
35
40
2019202020212022202320242025
Cumulative number of...
[MoUs / agreements]
No. JCM MoUs
No. Article 6 bilateral agreements
No. Article 6 MoUs
Glasgow
breakthrough
First ITMO transfer
First Initial Reports
Baku operationalisation
Source: Article 6 Pipeline (UNEP-CCC, 2025)

17. 17
Summary reflections
OECD support to Carbon Market Platform:
•Flexibility, strategic perspectives and analytical rigourmakes the CMP Secretariat a unique player in a
crowded landscape of carbon pricing initiatives.
Last 10 years of carbon pricing approaches:
•Positive developmentsfor the number of instruments and levels of explicit carbon prices
•Limited progress on overall GHG price signal warrants focus on implicit and explicit pricing
•Some agreement on sectoral pricing, but politics of adoption vs. ambition are challenging
•Article 6 took a long time to agree, entering implementation phase in a new market context

18. Thank you for your attention.
Contact:
[email protected]
18
Contact details