In a paper to be presented to this month’s APGAS Forum in San Diego, Daley says national and regional systems explicitly pricing carbon emissions can be expected to become increasingly widespread and progressively interlinked and, over time, this will lead to price convergence.

The LNG sector can reduce global carbon emissions by providing a relatively clean fuel to replace coal.

But unlike coal, LNG produces significant emissions at the point of production and the sector could be hurt if forced to pay a carbon price at the point of production.

However, the domestic gas sector would benefit from a carbon price, Daley said.

For electricity generation, which accounts for about two-thirds of energy sector emissions globally, a significant carbon price is required to induce the switches between key fuel sources and technologies, such as coal to gas.

These switches are essential if big cuts in emissions are to be achieved.

“Switch prices” vary from country to country and are likely to change as relative fuel prices vary and change.

Daley argues that to effectively address climate change, there must be agreement on a long-term global goal and strategies – for emissions, or concentrations or temperature – together with consistent nearer-term emissions ‘pathways’ and strategies for individual countries.

But multilateral progress on climate change will only occur in tandem with progress on energy security and sustained economic growth.

The private sector must also be closely involved by accelerating research and development, and deploying clean energy technologies, as well as possibly collaborating on global sectoral approaches to emissions reduction.

The APGAS Forum will be held in San Diego from September 16-18.