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Carbon leakage is a concept to quantify an increase in greenhouse gas emissions in one country as a result of an emissions reduction by a second country with stricter climate change mitigation policies Leakage can also refer to production or investment, in which case industrial competitiveness is the more salient concern. This primer explains the underlying reasons for carbon leakage and discusses empirical evaluation of leakage as well as projection for different future scenarios.

Carbon Leakage | cep - Centre for European Policy Network

Carbon leakage refers to a situation where a company decides to move their production from a country with stringent policies, to a country that is more lenient, leading to an increase in greenhouse gas emissions. Leakage generally is shorthand for carbon leakage, which, even if intuitively understood as referring to greenhouse gas (ghg) emissions, can be defined in several ways Indeed, the term ‘carbon leakage’ typically refers to the subset of ‘trade embodied emissions’ that are specifically caused by climate policy asymmetries

The term ‘carbon leakage’ refers to the transfer of co 2 emissions from one country to another when, due to strict climate policies, companies relocate their production to countries with weaker emission constraints.

This technical note was prepared for the pmr secretariat by john ward, paul sammon, and guy dundas of vivid economics And grzegorz peszko (world bank group) and pauline kennedy (pmr secretariat), with support from sebastian wienges and nicolai prytz (world bank group). Carbon leakage is the shift of emissions from countries with strict environmental policies to those with more lenient regulations