Fair and effective carbon pricing for Austria: insights from model comparison

To solve the climate crisis, a fundamental decarbonisation of our society is indispensable. This requires a comprehensive mix of climate policy measures, most importantly the pricing of carbon emissions. As carbon taxes lead to manifold indirect effects and uncertainties, FARECarbon employs a stakeholder-assisted multi model comparison of carbon taxation in Austria. In a nutshell, in FARECarbon concerted policy scenarios will be simulated with three different macroeconomic models, which are rooted in different economic theories. These simulations will provide a sound basis for policymaking by illustrating the range of expected effects and related uncertainties, a so called “options space.” The close collaboration with stakeholders throughout the project will on the one hand result in the definition of concerted policy scenarios and on the other hand ensure the integration of stakeholders' perspectives in the development of a proposal for carbon taxation in Austria. This process substantially enhances the policy-relevance of the outcomes.