Climate Mitigation Policy in Türkiye

IMF Working Papers, May 12, 2023

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Discusses potential elements of a comprehensive strategy for making headway on Türkiye’s net zero emissions pedge for 2053.
Core elements include:
- aligning 2030 emissions commitments with long term neutrality;
- implementing a carbon price rising to an ilustrative $75 per tonne by 2030;
- enhancing acceptability through using carbon pricing revenues efficiently and equitably and including competitveness measures;
- introducing various feebate schemes (the fiscal analogue of regulations) to reinforce mitigation incentives in the power, industry, transport, building, forestry, and agricultural sectors.

A phased revenue-neutral $75 carbon price:
- reduces CO2 emisisons 21 percent below baseline levels in 2030;
- raises revenues of 1.7 percent of GDP;
- avoids 11,000 air pollution deaths over the decade;
- imposes an average burden on households of 3 percent of their consumption (before revenue-recycling).
With revenues used for targeted transfers and labor tax reductions:
- the overall policy is pro-poor and pro-equity;
- average household is better off by 0.4 percent.

Align near-term (2030) commitments with long-term neutrality (2053).
Implement a phased carbon price reaching $75 per tonne by 2030.
Use carbon pricing revenues efficiently and equitably to enhance acceptability:
- targeted transfers;
- labor tax reductions.
Include competitiveness measures to mitigate adverse impacts on exposed firms and sectors.
Introduce feebate schemes across sectors as a fiscal analogue to regulations to strengthen mitigation incentives in:
- power;
- industry;
- transport;
- building;
- forestry;
- agricultural sectors.

Subject: Carbon tax, Environment, Greenhouse gas emissions, Non-renewable resources, Renewable energy, Taxes
Keywords: agriculture, allowance price volatility, buildings, carbon pricing, carbon tax, Climate change, emission rate, emissions intensity, emissions trading system, feebate, forestry., Global, Greenhouse gas emissions, industry, mitigation policy, Non-renewable resources, power, Renewable energy, transportation, Türkiye climate mitigation