Planning ministry hosts webinar on carbon pricing, taxation

As part of government’s drive to develop methods to reduce carbon emissions coming out of COP 26, the Ministry of Planning and development hosted a webinar describing the possibilities of carbon pricing and taxation as part of TT’s emerging green economy.

Carbon pricing is the assessment of the cost that the public pays owing to the effects of greenhouse-gas emissions (GHG) – through damage to crops, healthcare costs, heat waves and droughts and loss of property from flooding and sea-level rising – and ties them to their sources by putting a price on the carbon emitted.

Head of multilateral environmental agreements at the ministry Kishan Kumarsingh said, “Coming out of COP26 which finished about two weeks ago, the rules under what was known as article 6 of the Paris Agreement on market mechanisms for carbon trading had been finalised.

"So this webinar is timely in terms of the next steps we would want to undertake in TT to set the policy framework for participating in the ordinary carbon market, as well as for recognising and developing approaches consistent with what is under the Paris Agreement.”

David Colin, task oversight manager of MexiCO2, a company which assists countries with entering into the voluntary carbon market said, while discussions at COP 26 revealed that much has been done to address the issue of carbon emissions and its effect, enough still isn’t being done.

“Fortunately we are able to reserve agreements that allows necessary frameworks in order to allow the flow of resources to developing countries and this would allow for important deliberations in the coming years in the voluntary carbon market.”

He said TT has committed to achieving an overall reduction in carbon emissions from power generation, transport and industry sectors of about 15 per cent by 2030.

Project manager Fernando Aguilera said the carbon tax could assist in reducing carbon emissions through companies deciding to either put mechanisms in place to reduce the greenhouse gasses they emit, or pay the cost of the carbon emissions according to the determined price coming out of the carbon pricing exercise.

“In Latin America we have a national carbon tax that covers a list of countries like Mexico, Colombia, Argentina and we have a special case of Mexico where entities are developing also carbon taxes for local economies.”

Officials told Newsday that Carbon Capture and Sequestration (CCS) projects – which are being looked at through the energy ministries and chambers in each country – can help a carbon market as a compliance tool. This would, however, rely on the design and rules of the carbon market of that country.

According to a 2019 World Bank report, Trinidad and Tobago produces close to 40 million tonnes of carbon a year, with each of our 1.4 million people generating about 31.28 tonnes of CO2 each year, making TT second in the world for carbon emissions per capita.