The agreement on the revision of the Emissions Trading System (ETS) reached on Sunday 18 December (see EUROPE 13087/4) has prompted reactions from business representatives, particularly on one point of the text directly linked to the Carbon Border Adjustment Mechanism (CBAM): the fate of exports of products covered by the CBAM.
Companies are concerned about their competitiveness on external markets, as when CBAM comes into force they will gradually lose the free emission allowances that the EU has granted them so far. “Producers in Europe will be severely affected in the long term by the lack of a solution for exports in the CBAM”, said industry alliance AEGIS.
The European cement association CEMBUREAU also regretted the lack of a “structural solution” for exports, which it said puts them at risk.
Representing even broader interests, the big business organisation BusinessEurope also called for an export solution that is both World Trade Organization (WTO) compliant and includes the maintenance of free quotas for European producers in the six CBAM sectors.
But the latter two conditions are not compatible, according to the EU Council and the European Commission, which rejected this option advocated by BusinessEurope while the European Parliament defended it.
Instead, the ETS agreement ensures that these companies can receive other forms of support for their green exports. The negotiators also asked the Commission to analyse potential carbon leakage between now and 2026 and the entry into force of the CBAM.
However, the solution found in the trilogue has pleased the Europe Jacques Delors think tank, which has campaigned against the so-called “export rebates”. (Original version in French by Léa Marchal)