Climate Mitigation:

Carbon and Energy Pricing Tool

EcoAct’s Carbon and Energy Pricing Tool can support you through analysis of regulatory risks and implementation of a tailored carbon pricing mechanism.

Carbon pricing mechanisms are key climate policy tools to help push companies towards a low-carbon future.

Carbon pricing is designed to ensure that businesses pay for the social and environmental costs of their carbon emissions. By raising the cost of carbon-intensive activities, carbon pricing mechanisms (carbon taxes and carbon markets) push companies to decarbonise and adopt more climate-friendly processes.

Regulatory Carbon Pricing: Governments require firms in certain industries to pay for their carbon emissions. Usually implemented via a carbon tax or cap-and-trade system. The EcoAct Carbon and Energy Pricing Tool calculates corporate financial risk, based on an up-to-date index of all national regulatory carbon prices.

Carbon and energy prices have undergone notable increases in recent years, posing significant financial risks for sectors reliant on fossil fuels. Recent research by EcoAct estimates that carbon price costs could account for 10% of the revenue of carbon-intensive sectors by 2030.

To address these growing risks, EcoAct has developed the Carbon and Energy Pricing Tool, a decision-making solution that enables businesses to anticipate the financial impacts of regulatory carbon and energy price^[1] fluctuations, as well as the financial opportunities arising from their transformation strategies.

Internal Carbon Pricing: Companies voluntarily apply a price to carbon emissions within their operations and/or supply chain to drive their decarbonisation efforts.

Integrating the carbon indicator into financial decisions by adopting internal carbon pricing mechanisms allows companies to inform and drive their transformation. By monetising the carbon impact of decisions in the short and long term, internal carbon pricing mechanisms help to assess the financial risks associated with the organisation’s business model and mitigate them by redirecting financial flows towards assets compatible with a low-carbon economy.

Whether your goal is to align your investments with your emission reduction strategy, raise awareness among your employees about the climate impacts of their operational decisions, finance your decarbonisation projects, or reduce the carbon footprint of your supply chain, we can support you in implementing an internal carbon pricing mechanism tailored to your needs.

^[1] It should be noted that the energy price scenarios are sourced from the EnerFuture database and are provided by the data provider Enerdata (Source: Enerdata/EnerFuture http://www.enerdata.net). End-user energy prices consider industry demand, production costs, national taxes and subsidies, as well as the latest geopolitical and climate policy developments.

The Carbon and Energy Pricing Tool:

A solution to help businesses manage transition risks related to carbon and energy prices

To better understand the positive or negative financial impacts resulting from the implementation of a low-carbon economic model, the Carbon and Energy Pricing Tool will support you to:

Anticipate future additional financial costs related to carbon and energy prices (natural gas, coal, gasoline, fuel and electricity in transportation, industry, building and power production) through scenario-based impact studies.
Facilitate the development of business model transformation strategies involving decarbonising core activities and transitioning to greener supply chains.
Evaluate the financial impact of transformation and decarbonisation actions, with annual updates of the company’s CO₂ emissions data and regular refreshes of information on energy and carbon prices in relevant geographical areas.

Specifically, the Carbon and Energy Pricing Tool allows modelling, at a country and sector level, based on three scenarios of energy and carbon price developments up to 2050:

Costs related to energy procurement and compliance with carbon regulations throughout the company’s value chain.
Financial impacts of the most significant sources of CO_2.
Savings achieved through CO₂ emission mitigation plans.

The tool also enables businesses to integrate their forecasts for the purchase of goods and services and energy consumption. Numerous modular charts and graphs facilitate a quick and visual understanding of key messages. The tool also allows for swift identification of the most exposed service lines and products that require immediate action.

Developed by climate economics experts at EcoAct, the Carbon and Energy Pricing Tool relies on internal regulatory monitoring of carbon taxes and Emission Trading Schemes development and energy price projections from Enerdata, a recognised data provider.

How we can help with

carbon pricing.

We can help prepare you for regulatory mechanisms or set up an internal price, using solutions customised to suit your needs.

Identify your risk
Advise on the existing and upcoming regulatory mechanisms that will have financial implications for you and your suppliers.
Advise on the existing and upcoming regulatory mechanisms that will have financial implications for you and your suppliers.
Quantify your exposure
Calculate the degree to which carbon emissions will increase your operational and supply chain costs in the coming years.
Calculate the degree to which carbon emissions will increase your operational and supply chain costs in the coming years.
Establish your carbon price
Engage with your senior stakeholders and design methodologies to implement a tailor-made internal carbon price fit to drive real transformation within your business.
Engage with your senior stakeholders and design methodologies to implement a tailor-made internal carbon price fit to drive real transformation within your business.
Monitor the results
Allow you to understand the success of your carbon pricing strategy, and consider ways forward.
Allow you to understand the success of your carbon pricing strategy, and consider ways forward.

2.05.2023

Factsheet

Internal Carbon Pricing

Access our factsheet to learn what an internal carbon price is, why your organisation should set one and how EcoAct can help with our three-phase approach.

2.05.2023

Factsheet

Regulatory Carbon Pricing

Learn what regulatory carbon pricing is, how it is changing and how businesses will be affected. EcoAct’s carbon pricing tool can help companies measure their exposure to regulatory carbon pricing and the financial implications of potential decarbonisation actions.

Why

choose EcoAct.

At EcoAct we are driven by a shared purpose to make a difference. To help businesses to implement positive change in response to climate and environmental challenges, whilst also driving commercial performance.

400

carbon offsetting projects supported across 55 countries worldwide

360+

experienced international experts with offices in 9 countries

+5,000

climate advisory projects delivered globally

7x

winner of the Environmental Finance Global Awards

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Carbon and Energy Pricing Tool

A solution to help businesses manage transition risks related to carbon and energy prices

carbon pricing.

Identify your risk

Advise on the existing and upcoming regulatory mechanisms that will have financial implications for you and your suppliers.

Quantify your exposure

Calculate the degree to which carbon emissions will increase your operational and supply chain costs in the coming years.

Establish your carbon price

Engage with your senior stakeholders and design methodologies to implement a tailor-made internal carbon price fit to drive real transformation within your business.

Monitor the results

Allow you to understand the success of your carbon pricing strategy, and consider ways forward.

Factsheet

Internal Carbon Pricing

Factsheet

Regulatory Carbon Pricing

Why

choose EcoAct.

400

360+

+5,000

7x

EU Fit for 55 Climate Package: Changes to EU’s carbon pricing policy and implications for businesses

Climate Mitigation

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Carbon Neutrality

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Energy Management Systems

ISO 50001

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