Iea

The IEA model was used to assess the carbon taxes needed to produce 1 per cent, 2 per cent, or 3 per cent annual reductions in emissions, as well as for stabilisation at 1990 levels. The major conclusion was that emission restrictions would require very high taxes (for example, $1,222 per tonne for Other OECD and $700 per tonne for NA OECD for a 3 per cent annual reduction in carbon emissions), given the rigidity in the energy sector in the short and medium term. Lower starting fuel prices, and higher carbon intensity in the North American power generation system, result in a carbon tax nearly double that for the same level of reduction in other OECD regions.

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