BoE warns banks: start preparing for a higher carbon price

Risk Live: stress tests should assume rising carbon price, regardless of government policy, says Breeden

The financial industry should plan for the arrival of a uniformly higher carbon price, irrespective of the speed of government action on the issue, a senior regulator at the Bank of England has said, adding that carbon pricing would play a significant role in the bank’s forthcoming climate stress-testing of large banks and insurers.

“Just because there isn’t a [carbon] price that has been set by governments doesn’t mean that we, as financial professionals, should think that price is zero,”