TY  - JOUR
A1  - Lilliestam, Johan
A1  - Patt, Anthony
A1  - Bersalli, German
T1  - The effect of carbon pricing on technological change for full energy decarbonization
BT  - a review of empirical ex-post evidence
JF  - Wiley interdisciplinary reviews : Climate change
N2  - In order to achieve the temperature goals of the Paris Agreement, the world must reach net-zero carbon emissions around mid-century, which calls for an entirely new energy system. Carbon pricing, in the shape of taxes or emissions trading schemes, is often seen as the main, or only, necessary climate policy instrument, based on theoretical expectations that this would promote innovation and diffusion of the new technologies necessary for full decarbonization. Here, we review the empirical knowledge available in academic ex-post analyses of the effectiveness of existing, comparatively high-price carbon pricing schemes in the European Union, New Zealand, British Columbia, and the Nordic countries. Some articles find short-term operational effects, especially fuel switching in existing assets, but no article finds mentionable effects on technological change. Critically, all articles examining the effects on zero-carbon investment found that existing carbon pricing scheme have had no effect at all. We conclude that the effectiveness of carbon pricing in stimulating innovation and zero-carbon investment remains a theoretical argument. So far, there is no empirical evidence of its effectiveness in promoting the technological change necessary for full decarbonization. This article is categorized under: Climate Economics > Economics of Mitigation
KW  - carbon pricing
KW  - climate policy
KW  - decarbonization
KW  - technological change
Y1  - 2020
U6  - https://doi.org/10.1002/wcc.681
SN  - 1757-7780
SN  - 1757-7799
VL  - 12
IS  - 1
PB  - Wiley
CY  - Hoboken
ER  -