The carbon tariff is coming!

Although there have been calls in many countries to impose carbon border adjustment taxes on imported products, they have never really landed

On March 10, 2021, the European Parliament passed a resolution on the EU Carbon Border Regulation Mechanism (CBAM) compatible with the WTO

Experts said that once the EU's carbon tariffs are implemented, some energy-intensive and high-emission industries in countries with which it trades, such as metal smelting and chemicals, may face greater impact

After 2023, energy-intensive industries will be gradually included

The EU intends to achieve carbon neutrality by 2050, and the carbon border adjustment tax proposal is part of this ambitious goal

The bill passed this time mainly includes three points: First, all commodities under the EU carbon emissions trading system should be included in the scope of carbon tariffs; second, the income from carbon tariffs should support the EU climate energy industry policy; third, the The mechanism must not be abused by trade protectionism

The bill stated that it is necessary to prevent "carbon leakage" on the issue of climate change.

It is reported that starting from 2023 and after evaluation, the EU carbon border adjustment mechanism will cover the power industry and high energy consumption industries such as cement, steel, aluminum, oil refining, paper, glass, chemicals and fertilizers; these industries still continue to receive a large amount of free carbon.

The European Commission’s economic recovery plan proposal previously pointed out that, depending on the scope and specific design, the carbon border adjustment mechanism can bring about 5 billion to 14 billion euros in additional revenue each year

According to the plan, after the bill is voted through by the European Parliament, the European Commission will formally propose a specific plan for carbon tariffs in the second quarter of 2021 on this basis.

Many countries are considering levying carbon tariffs

The carbon border adjustment tax is not a new concept.

The first is to protect the effectiveness of unilateral environmental policies.

The proposal of a carbon tariff has been discussed for quite some time in both the EU and the United States

The U.

At present, more and more people believe that carbon tariffs can be levied in a manner consistent with WTO rules

China's high-carbon industry may face pressure

The EU carbon tariff issue has attracted market attention

Zhong Jun, the former general manager of China Southern Power Grid, said earlier that China has contributed a lot to reducing emissions in recent years.

Antaike's research team believes that the implementation of the EU's carbon tariff policy will bring new pressure on China's aluminum exports
.
In view of the energy structure of China's emphasis on fossil fuels, the carbon footprint of the aluminum industry is significantly higher than that of foreign hydropower-rich countries
.
In 2020, the unit emission intensity of China's electrolytic aluminum industry is three times that of the EU
.
Under this pressure, the future aluminum export situation will become more severe
.

In the context of carbon peaks and carbon neutral goals, high-energy-consuming industries will surely accelerate the pace of green transformation.
This is a realistic requirement to help China fully realize the "30-60" target, and it is also the relevant industry to maintain international standards.
The inevitable choice for competitiveness
.

According to Zhao Lijian, head of the Carbon Trust China Office, many individuals and companies in China regard CBAM as a trade barrier and additional export cost, but some companies with advanced technology and low-carbon products may also View CBAM as an opportunity
.

Many experts believe that Chinese companies should take action to deepen their understanding of product carbon footprints and how to reduce carbon footprints.
This will help them implement green development strategies and prepare for EU border taxes
.
At the same time, accelerating the development of China's carbon trading market can not only help energy conservation and emission reduction, but also continue to encourage sustainable green investment
.