LowEmissionAsphalt-136pg-WhitePaper-May2023

P a g e | 17 Carbon Pricing – Get Prepared Carbon pricing aims to make it more expensive to emit carbon dioxide and other greenhouse gases , to ensure that market actors take account of the costs of emissions when making commercial decisions. When facing a carbon price, firms will seek to minimize costs by investing in the most cost- effective abatement solutions, and consumers may change their behavior to substitute away from emissions intensive goods. Carbon pricing regulations hence channel economic activities toward a low-carbon outcome. The U.S. Environmental Protection Agency (EPA) recently increased its estimated ‘societal cost’ of carbon to $190 a ton 32 or 4x current carbon offset index values . Meeting this newly proscribed societal cost of carbon, if implemented in any carbon pricing scheme, would more than triple the $600 billion estimated transportation industry carbon neutral offset minimum previously outlined using 2030 Paris Agreement minimum values for carbon. We believe recent pronouncements such as the FHWA’s Climate Challenge , which focusses on paving industry EPDs is just the beginning of what may come for our industry. The primary objective of any carbon pricing scheme is simply to limit total covered emissions while providing incentives for mitigation to be achieved at the lowest possible cost. It also aims to drive a sustainable economic transformation by aligning profits with low-emission investment and innovation. These objectives for reducing GHG emissions go hand in hand with achieving a wide range of outcomes including improved air quality, induced technological change, and the creation of new age jobs, and other perceived or realized benefits. The Paris Agreement 33 adopted by 195 nations in December 2015, including the United States, under the guidance of the United Nations Framework Convention 32 EPA and U.S. Interagency Working Group (IWG). 33 The Paris Agreement , also the Paris Accords or Paris Climate Accords , is an international treaty on climate change. Adopted in 2015, the agreement covers climate change mitigation, adaptation, and finance. The Paris Agreement was negotiated by 196 parties at the 2015 United Nations Climate Change Conference. EPA recently increased its estimated ‘societal cost’ of carbon to $190 a ton or 4x current carbon offset index values. .