Why do we need carbon pricing?

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Carbon pricing is needed to internalize some of costs of use of carbon-based fuels which are not currently part of the cost.

The costs include

• environmental and

• societal costs

• Including

  • pollution,

  • impact on public health,

  • global warming and

  • climate change.

These costs are considered a “negative externality” or the costs borne by a third party i.e. neither the producer or consumer.

The following video by Climate Reality Project describes the carbon pricing and the need for it.

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