Singapore mulls wider carbon market in crafting carbon tax law

SINGAPORE, in preparing for the possible linkage of its carbon tax framework to external carbon markets in future, will use a credits-based mechanism for its carbon tax.

Facilities that have to pay a carbon tax will therefore do so by buying and surrendering the number of carbon credits corresponding to their greenhouse gas emissions, according to a draft carbon pricing bill.

The carbon credits will be issued by the National Environment Agency (NEA) at a fixed price, which will be determined closer to the implementation date of Jan 1, 2019. The government has also not yet indicated the actual amount of carbon tax, though it had said this will be between S$10-20 a tonne of greenhouse gas emissions.