Addressing export concerns in the CBAM File

The document assesses the challenges of the EU's proposed CBAM based on incurred emissions, noting that it fails to fully address carbon leakage for exports and value chains. It proposes an alternative 'climate contribution' based on standardised carbon intensity factors, which would act as an excise charge that can be passed along the supply chain and waived for exports. This model, combined with Carbon Contracts for Difference (CCfDs) funded by CBAM revenues, is presented as a way to create immediate investment incentives for climate-neutral production of materials like steel, cement, and aluminium.

• The production of basic materials, including steel, cement clinker, plastic, fertiliser (ammonia), and aluminium, is responsible for 16% of EU emissions and 25% of global emissions.
• The EU Commission's proposed CBAM based on incurred emissions is criticized for not waiving carbon costs for exports and for the administrative complexity of covering supply chain emissions, which leaves carbon leakage risks unaddressed.
• A proposed alternative CBAM based on standardised values would use a 'climate contribution' excise charge calculated by applying the EU ETS carbon price to a material's quantity multiplied by a standard carbon intensity factor.
• To support the transition to climate-neutral production, the authors propose using CBAM revenues to fund Carbon Contracts for Difference (CCfDs), which would cover the incremental costs of clean processes compared to conventional ones.
• The current EU ETS free allowance system can lead to significant windfall profits; the authors estimate these could reach €78 billion between 2021 and 2030 in a high carbon-cost pass-through scenario.
• The proposed standardised-value CBAM is estimated to have a minimal impact on low-income German households, adding approximately 50 € per year, or 0.4% of their budget, at a carbon price of 75€/ton.

APA

Neuhoff, K., Chiappinelli, O., Gerres, T., Ismer, R., Köveker, T., Linares, P., & Richstein, J. (n.d.). Addressing export concerns in the CBAM File. Climate Strategies. https://climatestrategies.org/wp-content/uploads/2022/03/Addressing-export-concerns-in-the-CBAM-File-9-3-2022.pdf

Chicago

Neuhoff, Karsten, Olga Chiappinelli, Timo Gerres, Roland Ismer, Till Köveker, Pedro Linares, and Jörn Richstein. Addressing export concerns in the CBAM File. Climate Strategies, n.d. https://climatestrategies.org/wp-content/uploads/2022/03/Addressing-export-concerns-in-the-CBAM-File-9-3-2022.pdf.

Wikipedia

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BibTeX

@techreport{neuhoffndaddressing, author = {Neuhoff, Karsten and Chiappinelli, Olga and Gerres, Timo and Ismer, Roland and Köveker, Till and Linares, Pedro and Richstein, Jörn}, title = {{Addressing export concerns in the CBAM File}}, institution = {Climate Strategies}, url = {https://climatestrategies.org/wp-content/uploads/2022/03/Addressing-export-concerns-in-the-CBAM-File-9-3-2022.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }