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CDP Climate Change 2022 Reporting Guidance

(C11.1) Are any of your operations or activities regulated by a carbon pricing system (i.e. ETS, Cap & Trade or Carbon Tax)?

Change from last year

No change

Rationale

Companies are requested to report whether they are subject to, or potentially subject to, mandatory carbon pricing systems. This question has evolved to include whether companies are currently regulated by a carbon pricing system – including carbon markets or taxation – or whether they expect to be regulated in the future. Companies responding ”Yes” will be further prompted to identify the systems in which they participate and to provide additional details about their exposure to these systems. This information allows investors to consistently track and analyze corporate expectations and the associated costs of carbon pricing regulations, and forces unregulated companies to consider potential future exposure.

Connection to other frameworks

SDG

Goal 13: Climate action

Response options

Select one of the following options:

  • Yes
  • No, but we anticipate being regulated in the next three years
  • No, and we do not anticipate being regulated in the next three years

Requested content

General

  • Companies responding ”Yes” will be further prompted to identify the systems in which they participate and to provide additional details about their exposure to these systems.

Additional information

  • Carbon pricing policies: Carbon pricing is a key policy mechanism to drive greenhouse gas emissions reductions and mitigate the dangerous impacts of climate change. Policies primarily manifest in one of two ways; or, in some countries and regions, both ways:

    • - An emissions trading scheme, also known as a cap and trade system, is a market-based allowance system in which participants can buy and sell a set amount of allowances based on their emissions levels. Low emitters will have allowances left over for sale, which higher emitters will buy to offset their emissions – operating in a demand and supply scenario.
    - A carbon tax attaches a fee to carbon emissions.

These policies in practice vary specifically on a case-by-case basis.

For more information, please see:

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