Tax CO2 at home or face EU carbon tariff - European Commission
THE European Union called on other countries to tax carbon emissions to avoid a coming EU tariff on imports, said EU Economic Affairs Commissioner Paolo Gentiloni, reports Bloomberg
25 March 2021 - 19:00
The new EU tariff would help avoid 'carbon leakage', a phenomenon where producers move to regions with more lenient pollution rules, said Mr Gentiloni.
The European Commission aims to penalise emissions on imports such as cement, steel, fertilisers and power, said Mr Gentiloni.
The planned 'Carbon Border Adjustment Mechanism' is part of the Green Deal, which aims for climate-neutral Europe by the middle of this century.
Mr Gentiloni said nations need accelerate global warming action before the next international climate talks in Glasgow.
'We need to build on such a global trend to set up joint approaches with like-minded international partners, including by introducing equivalent carbon pricing mechanisms,' he said.
The EU wants to play a leading role in the global fight against global warming and plans to toughen its 2030 emissions-reduction goal to at least 55 per cent from 1990 levels.
The risk of companies relocating their production abroad is expected grow as emission taxes rise in Europe, which recently topped EUR40 (US$47.32) per tonne, said French Finance Minister Bruno Le Maire.
The European Commission expects something like EU Emissions Trading System, Mr Gentilon said. In such a 'notional ETS,' importers of emissions-intensive goods would have to pay a charge linked to the price of allowances in the world's biggest carbon market.
'Importers will not be subject to an adjustment that is higher than what applies to domestic EU producers,' Mr Gentiloni said. The Commission is also considering ways to excuse poor countries, he said.
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