SINGAPORE—A significant rise in carbon pricing is needed to achieve the goal of limiting the rise in global temperatures to within 1.5 degrees Celsius, according to a report by consultancy Wood Mackenzie.

Global average temperatures are currently 1.2 degrees Celsius above pre-industrial levels. Limiting the rise to 1.5 degrees Celsius would not be possible without rapid and sustained action, the consultancy said on March 4.

The Paris climate agreement, adopted by almost 200 nations in 2015, set a goal of limiting warming to “well below” a rise of 2 degrees C above pre-industrial times while “pursuing efforts” for the tougher 1.5 degree goal.

“To be on a 1.5-degree pathway, carbon support prices will need to reach $160 per tonne of carbon dioxide by 2030,” said Wood Mac’s Asia Pacific head of markets and transitions Prakash Sharma.

As of the end of last year, the global average carbon price across various regimes stood at $22 per tonne of carbon dioxide, he said.

Governments around the world need carbon policies that target hard-to-abate industries, for instance, by facilitating low-carbon hydrogen production, Wood Mac said.

Industries such as heavy industry and transport are considered hard to abate because of the cost and upheaval of transitioning to electrification.

Policymakers could also combine carbon, capture and storage (CCS) and direct air capture (DAC) with other measures to lower the overall impact of carbon emissions reduction, Wood Mac said.

To limit the rise of global average temperatures to 1.5 degrees Celsius, $50 trillion is the minimum capital expenditure needed, said the consultancy’s Americas head of markets and transitions David Brown.

Of that, “$27 trillion will come from new power capacity, energy storage, electrolyzers and CCS deployments through to 2050, while $23 trillion is required to cover associated infrastructure, battery metals and hydrocarbons,” he said.