The Partnership for Market Implementation—PMI—will become operational in early 2021 to support countries embarking on carbon pricing move from readiness to rollout.
The objective of the Partnership is to assist participant countries to design, pilot and implement explicit carbon pricing instruments aligned with domestic development priorities. As a 10-year program with a capitalization target of US$250 million, the Partnership brings an ambitious and long-term vision of introducing a strong price signal on carbon emissions through programs and policies across jurisdictions and sectors to contribute to the Paris Agreement goal of limiting temperature rise to 1.5°C.
The Partnership responds to increased demand for implementation support from countries, with over half (96 of 195) having indicated that they are planning or considering the use of carbon pricing to meet their NDCs.
The Partnership for Market Implementation is the successor program to the World Bank’s successful Partnership for Market Readiness (PMR) effort that has, since 2011, supported emerging economies and developing countries design and deploy carbon pricing and market instruments to facilitate the reduction of emissions. PMR provided funding and technical assistance to 23 countries, accounting for 46% of the global GHG emissions, all of whom now have the basic nuts and bolts of a carbon pricing system in place. Some of the PMR-supported readiness work at the country level include:
- Supported China’s ETS pilots in two provinces and five cities, by building technical and institutional capacity and analytical foundation for establishing the systems
- Assisted Jordan in passing a climate change by-law on how to measure, report and verify its GHG emissions, a key prerequisite for carbon pricing.
- Supported Kazakhstan with its current national ETS and with building an online MRV platform – it is the only Central Asian country with a carbon pricing system now in place.
- In Colombia, the PMR is supporting the development of a hybrid pricing system – where an ETS will complement its existing carbon tax (in place since 2017) for greater effectiveness.
- And the PMR is currently helping Indonesia, Thailand, Turkey and Vietnam determine which instrument – carbon tax or an ETS or a crediting system - would be most optimal for their economies and emissions profiles.
- The PMR Partnership has further generated and disseminated a substantial body of knowledge on various aspects of carbon pricing, readily accessible via its knowledge center.
The Partnership for Market Implementation will:
- Support 30 countries and jurisdictions in the development and implementation of carbon pricing instruments to meet their NDC targets and long-term decarbonization strategies.
- Assist in enabling countries’ participation in the operationalization of Article 6 of the Paris Agreement which would facilitate international cooperation on carbon markets and promote the convergence of national carbon pricing instruments;
- Assist countries in identifying and implementing best practice approaches and, where relevant, helping them achieve compatibility in design with other carbon pricing efforts and markets;
- Inform the national and international policy discussions on greenhouse gas (GHG) mitigation by sharing lessons learned and providing a platform for collective innovation on carbon pricing instruments; and
- Develop a comprehensive knowledge base on carbon pricing instruments and market mechanisms, and facilitate information exchange through technical discussions and dissemination of knowledge products;
The activities will be developed and executed on a country-specific basis, with regional or subnational level activities supported based on specific needs. Activities could include:
- Analytical support to policy formulation in context of country’s NDC mitigation policy
- Enhance capacity of GHG data collection and management
- Design and enhance existing Measurement, Reporting and Verification (MRV) framework
- Enhance capacity development to create institutional structure implementing carbon pricing instruments
- Knowledge generation and management
- Facilitate participatory discussion of policy and legal frameworks for carbon pricing instruments implementation
- Advisory support for the design of selected carbon pricing instruments
- Piloting, testing and implementation of carbon pricing instruments