Carbon pricing and planetary boundaries

Gustav Engström (), Johan Gars, Chandra Krishnamurthy, Daniel Spiro, Raphael Calel, Therese Lindahl and Badri Narayanan
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Gustav Engström: Royal Swedish Academy of Sciences
Johan Gars: Royal Swedish Academy of Sciences
Chandra Krishnamurthy: Royal Swedish Academy of Sciences
Therese Lindahl: Royal Swedish Academy of Sciences
Badri Narayanan: University of Washington Seattle

Nature Communications, 2020, vol. 11, issue 1, 1-11

Abstract: Abstract Human activities are threatening to push the Earth system beyond its planetary boundaries, risking catastrophic and irreversible global environmental change. Action is urgently needed, yet well-intentioned policies designed to reduce pressure on a single boundary can lead, through economic linkages, to aggravation of other pressures. In particular, the potential policy spillovers from an increase in the global carbon price onto other critical Earth system processes has received little attention to date. To this end, we explore the global environmental effects of pricing carbon, beyond its effect on carbon emissions. We find that the case for carbon pricing globally becomes even stronger in a multi-boundary world, since it can ameliorate many other planetary pressures. It does however exacerbate certain planetary pressures, largely by stimulating additional biofuel production. When carbon pricing is allied with a biofuel policy, however, it can alleviate all planetary pressures.

Date: 2020
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DOI: 10.1038/s41467-020-18342-7

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