REACT Global Carbon Price Index

REACT Global Carbon Price Index measures financial loss and damage arising from carbon emissions by using the Reinsurance Event-Attributed Carbon Tax (REACT) methodology. Use the chart below to explore the monetary effects that recent climatological events are having in terms of dollars per tonne of carbon dioxide emitted.

 




 

REACT Global Carbon Price Index Explained

The REACT Global Carbon Price Index measures financial loss and damage arising from carbon emissions by using the Reinsurance Event-Attributed Carbon Tax (REACT) methodology. Further, it determines the allocation of the costs of those losses to each energy user based upon the proportion of carbon emitted and the carbon intensity of the fuel type used. The total revenue paid by all users equals the total loss and damage caused by their emissions. Additionally, a method has been developed to determine the extent to which extreme weather events can be attributed to anthropogenic (human) emissions of CO2 and it combines the various categories of losses with appropriate ‘global attribution factors’. These factors are derived from changes in temperature anomaly (global warming).

A new pricing mechanism for financing carbon emission reduction that takes into account the real cost of damage that emissions are causing: Business and individuals report GHG emissions, Re/insurers report insurance losses arising from storms, drought, flood, landslide and wildfire events, Event attribution apportions the financial losses directly attributable to GHG emissions, a carbon tax is dynamically applied to business to pay for the cost of damages. This provides both financial measurement of climatological damage and the reduction of GHGs and climatological damage.

 


 

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REACT Global Carbon Price Index was last modified: January 4th, 2018 by admin