Name: Carbon Pricing Incidence Calculator (CPIC)
Type: Policy assessment tool
Institution: Mercator Research Institute on Global Commons and Climate Change (MCC) (with funding from GIZ)
Documentation: Website; Methodology
Geographic coverage: Single country (global)
Description: CPIC is an interactive web tool that currently allows the vertical and horizontal distributional consequences of carbon pricing and various compensation measures to be explored for 88 countries. To this end, it combines country-level household budget surveys and multi-regional input-output data (from the Global Trade Analysis Project [GTAP] Data Base). The tool calculates the additional costs to households after a carbon price is introduced, i.e., the carbon pricing incidence.
Questions to be answered/variables considered: CPIC is designed to provide insights for a broader policy dialogue on the design and implementation of carbon pricing schemes. It can be used to explore different carbon pricing scenarios and stylized redistribution mechanisms and to compare the distribution of additional costs in or between different groups of the population in the selected country.
Development: The tool was developed in an iterative process between Ministries of Finance and other relevant stakeholders, supported by the German development agency GIZ. Government staff were trained to use CPIC to enable them to produce results and evaluate stylized scenarios independently, and to help inter- and intra-ministry dialogue.