Internal Carbon Price (ICP)

An internal carbon price is a monetary value that companies assign to their greenhouse gas emissions internally to guide business decisions, investment appraisals, and risk management. Two models exist: a shadow price (hypothetical cost used in analysis) and an internal fee (actual levy on business units). ICPs typically range from $10-150/tCO₂e. CDP reports that over 2,000 companies use or plan to use ICPs. ICPs help anticipate regulatory carbon pricing and drive decarbonisation investments.