Impact of Carbon Prices and Fuel Prices on Industry Competitiveness

IMPACT OF CARBON PRICES AND FUEL PRICES ON INDUSTRY COMPETITIVENESS
Impact of Carbon Prices and Fuel Prices on Industry Competitiveness by Sector

1IMPACT OF CARBON PRICES AND FUEL PRICES ON INDUSTRY COMPETITIVENESS
Table of Contents
Literature Review.......................................................................................................................2
1. Introduction:.......................................................................................................................2
2. Carbon pricing:...................................................................................................................2
3. Impact of carbon and fuel pricing on industry competitiveness:.......................................2
4. Techniques of managing adverse effects of carbon and fuel prices on industry
competitiveness:.....................................................................................................................4
5. Summary:...........................................................................................................................5
References:.................................................................................................................................6

2IMPACT OF CARBON PRICES AND FUEL PRICES ON INDUSTRY COMPETITIVENESS
Literature Review
1. Introduction:
One of the most effective strategies that businesses and governments are utilising for
addressing climate change is carbon and fuel pricing. There is a simple principle, in which
price on carbon pollution is placed in order to account for the effects of greenhouse gas
emissions stemming from the economic choices undertaken by both consumers and
producers. A correct price signal for carbon would spur organisations, customers and
investors in switching preferences from emission-intensive industries, practices and processes
to climate resilient and low carbon alternatives. The current chapter would emphasise on
analysing the impact of carbon and fuel prices on industry competitiveness by sector.
2. Carbon pricing:
As defined by Ranson and Stavins (2016), carbon pricing is an instrument capturing
the external greenhouse gas emission costs like healthcare costs from droughts and heat
waves and property loss from rise in sea level and flood. Carbon pricing assists in transferring
the damage from greenhouse gas emissions to those accountable for the same along with
having the ability to avoid it.
3. Impact of carbon and fuel pricing on industry competitiveness:
The polluter pays principle supports carbon and fuel pricing and its enforcement is
meant in order to account the damage cost owing to greenhouse gas emissions and the
playing field is tilted from emission-intensive activities to low-carbon solutions. There are
few sectors that are controlled by fossil fuel production, consumption and processing and
these sectors would contract under carbon pricing (Branger and Quirion 2013). On the other
hand, investment and production decisions are affected by a variety of influential dynamics.