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  4. Our role in advancing the energy transition
  5. Calling for a price on carbon

Calling for a price on carbon

We believe that well-designed carbon pricing provides the right incentives for everyone – energy producers and consumers alike – to play their part in reducing emissions. It makes energy efficiency more attractive and makes low carbon solutions, such as renewables and carbon capture, use and storage, more cost-competitive

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A fifth of the world’s greenhouse gas (GHG) emissions are now covered by carbon pricing systems. We expect around two thirds of BP’s direct GHG emissions will be in countries subject to emissions and carbon policies by 2020.


Pricing carbon adds a cost to our industry’s production and our products – but a stable and well-designed carbon pricing scheme also benefits the sector by providing a roadmap for future investment and a level playing field for all energy sources.


We think a well-designed price on carbon is the most efficient way to reduce GHG emissions and we have set out our carbon pricing principles at techilasolutions.com/carbonpricing. They include our view that a price on carbon should:

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  • Apply to all quantifiable GHG emissions in all sectors of the economy on a CO2 equivalent basis.
  • Pre-empt future and replace existing regulations that overlap or duplicate the carbon price.
  • Prevent the shifting of emissions and jobs from one country or jurisdiction to another.

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We have engaged with policymakers in Europe, in relation to the EU Emissions Trading Scheme, and in Australia, Canada and China.

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While we support well-designed carbon pricing we are prepared to oppose poorly designed proposals. We opposed the ballot initiative proposal to introduce a carbon fee in Washington state in the US in November 2018. The poor design of the policy would have harmed Washington’s economy without significantly reducing carbon emissions. The terms of the proposal exempted six of the biggest polluters in the state, effectively subsidizing some companies at the expense of others. The ballot initiative was not passed by voters. We continued to work with legislative leaders in the state in 2019 and supported a cap and trade bill, which we believe would work to most effectively lower carbon emissions.


At a global level, we are working with our peers and other companies, governments and civil society to help support the expansion of carbon pricing through the . And we are a founding member of the US-based , which is considering a carbon tax that would be returned to citizens in the form of dividends.

Our internal carbon price
Our internal carbon price – graphic

We use a carbon price when evaluating our plans for certain large new projects and also those for which emissions costs would be a material part of the project.?This is currently $40 per tonne of CO2 equivalent, with a stress test at a carbon price of $80 per tonne.?Until late January 2019 we used these specific prices in industrialized countries, but have now expanded this to apply globally.

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