Today, October 1st 2023, the CO2 border adjustment mechanism enters its testing phase. Importers of steel, aluminum, fertilizers, and several other products are obligated to provide information about the CO2 footprint of the goods they import.
The CO2 border adjustment mechanism is one of the EU’s most ambitious climate policy projects. With the ‘Carbon Border Adjustment Mechanism’ – abbreviated as CBAM in Brussels – Europeans aim to protect their climate efforts from imports originating in third countries with less stringent climate policies.
The basic idea is simple: Starting from 2026, those importing goods from countries without an Emissions Trading System (ETS) like the EU will pay a surcharge, theoretically equalising the European CO2 price, to prevent goods produced in Europe from being at a cost disadvantage compared to products from other parts of the world.
Source
Unternehmen fürchten Chaos vor Start des CO2-Grenzausgleichs (Companies fear chaos ahead of the start of the CO2 border adjustment mechanism), Handelsblatt, 2023-09-28
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