Professor Michael Grubb gives this public lecture 'The Carbon Pricing Paradox' at The Australian National University on 12 April 2011.Professor Grubb discusses economic principles of carbon pricing and how they conflict with political economy. Drawing upon the experience of the EU emissions trading system, he emphasises the need to understand the political evolution of a carbon pricing system and the implications for design. The talk will also consider the core issues around energy intensive industries, and the need to set out an evolutionary path from free allocation to WTO-compatible border measures as part of international 'carbon-added' pricing systems.Professor Michael Grubb is Chair of the international research organization Climate Strategies, headquartered at Cambridge University where he is also a Senior Research Associate at the Faculty of Economics. He is a leading expert in industry competitiveness under the EU ETS and has been leading research on industrial competitiveness and carbon leakage for the last four years. His former positions include Chief Economist at the Carbon Trust, Professor of Climate Change and Energy Policy at Imperial College London, and head of Energy and Environment at Chatham House, and he continues to be associated with these institutions. In 2008 he was appointed to the UK Climate Change Committee, established under the UK Climate Change Bill to advise the government on future carbon budgets and to report to Parliament on their implementation. Michael Grubb is author of seven books, fifty journal research articles and numerous other publications. He has held numerous advisory positions with governments, companies and international studies on climate change and energy policy, and has been a Lead Author for several reports of the IPCC on mitigation, including the IPCC Fourth Assessment Report. He is editor-in-chief of the journal Climate Policy and is on the editorial board of Energy Policy. His most recent works have been directing Climate Strategies research on competitiveness dimensions of the EU ETS, now extending into analysis of EU ETS design and impacts to 2020; and editing a book A low carbon electricity system for the UK: technology, economics and policy (Cambridge University Press, May 2008).