Lawmaker drafts ‘complete overhaul’ of EU carbon border levy

(EurActiv, 12 Jan 2022) The EU lawmaker in charge of negotiating Europe’s upcoming levy for carbon-intensive imports has recommended drastic changes, including a quicker rollout and adding more products to the scope of the draft legislation.

In July last year, the European Commission proposed a carbon border adjustment mechanism (CBAM) to put a price on carbon-intensive imports. The proposal is aimed at protecting EU businesses from unfair competition and prevent so-called carbon leakage, where companies relocate to countries where it is cheaper to pollute.

The proposal is now in the hands of the European Parliament and EU member states, who will need to agree a common text before the levy becomes a reality.

The lawmaker in charge of Parliament negotiations, Mohammed Chahim from the left-wing Socialists and Democrats (S&D) group, has pulled no punches in suggesting improvements to the Commission’s proposal in a draft report seen by EURACTIV.

“[Chahim’s report] is a complete overhaul, making substantial and important changes to the initial text,” according to Pierre Leturcq, senior policy analyst at the Institute for European Environmental Policy (IEEP), a think-tank.

One amendment tabled by Chahim is to expand the levy’s scope. Under the EU executive’s proposal, iron and steel, cement, fertiliser, aluminium and electricity generation would be covered by CBAM.

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EurActiv, 12 Jan 2022: Lawmaker drafts ‘complete overhaul’ of EU carbon border levy