Cover of report "Third-country carbon pricing under the EU CBAM"
Climate | Energy

Third-country carbon pricing under the EU CBAM

Approaches for and challenges of recognising domestic payments


In October 2023, the EU introduced a Carbon Border Adjustment Mechanism (⁠CBAM⁠) imposing a carbon price on imports of selected goods to the EU market. This way, the CBAM complements the European Emissions Trading Scheme (EU ETS). One question that arises for the implementation of the new instrument is how third-country carbon prices can be recognised and deducted from CBAM payments. The discussion paper presents two possible approaches: One that recognises carbon costs that are actually incurred, and another that uses carbon price averages of the country of origin.

The discussion paper raises conceptual considerations and open questions regarding the technicalities of recognising third-country carbon prices, such as the treatment of multi-product installations or upstream carbon pricing instruments. It discusses challenges that are specific to the processes of cap-and-trade systems, tradable performance standards, and carbon taxes.

Reihe
Climate Change | 15/2024
Seitenzahl
37
Erscheinungsjahr
Autor(en)
Theresa Wildgrube, Iryna Holovko, Leon Heckmann
Sprache
Englisch
Forschungskennzahl
3720 42 504 0
Verlag
German Environment Agency
Zusatzinfo
PDF ist barrierefrei
Dateigröße
662 KB
Preis
0,00 €
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Schlagworte:
 EU ETS  Maritime  Fit for 55  emissions trading