Carbon Pricing Covers 29% of Global Emissions, Raising $107 Billion in 2025

Context The World Bank's State and Trends of Carbon Pricing 2026 report compiles data from governments and exchanges. It tracks each active carbon tax or emissions‑trading scheme, calculates the share of global greenhouse gas emissions they cover, and sums the revenue they generate. The report also averages the price per tonne of CO2e across all jurisdictions to show price trends.

Key Facts The report finds that just over 29% of global emissions are now priced directly, up from less than 10% a decade ago. Revenue from those mechanisms reached $107 billion in 2025, roughly three times the $30 billion collected in 2016. There are 87 active carbon pricing policies worldwide, seven more than the previous year. All major middle‑income economies have either implemented or plan to implement direct carbon pricing, with India and Vietnam showing the strongest progress in 2025. The average carbon price stands at nearly US$21 per tonne of CO2e, a 7% increase from the prior year’s edition and double the level ten years earlier. In voluntary carbon credit markets, traded volume rose 8% between 2024 and 2025, while overall credit prices slipped slightly. Credits linked to airline‑eligible projects and highly rated forest conservation still command a premium despite the broader price dip. The World Bank notes that if more emerging economies adopt the instruments currently under development, coverage could approach one‑third of global emissions.

What It Means Higher coverage and rising prices indicate that carbon pricing is becoming a stronger lever for steering energy investment and financing climate action. As Paschal Donohoe of the World Bank Group explained, well‑designed carbon markets help countries choose their energy mix, drive efficiency and innovation, and mobilise resources for development priorities. The trend suggests that expanding these tools to additional emerging economies could push global coverage toward the one‑third mark and further increase annual revenue.

What to watch next Watch for policy announcements from large emerging markets, especially India and Vietnam, as they consider expanding or linking their carbon pricing systems, which could lift global coverage and price levels in the coming years.