The path of least resistance

This report by Sandbag analyzes how the disparity in carbon pricing between the EU Emissions Trading Scheme (EU ETS) and its non-EU neighbors leads to 'carbon leakage,' where high-carbon electricity, primarily from coal, is imported into the EU. The authors argue that this undermines EU climate goals and incentivizes the continued use of coal in neighboring states. To combat this, the report proposes the implementation of a border carbon adjustment (BCA) specifically for electricity imports.

• The EU ETS region is increasingly importing electricity from countries with little to no carbon pricing. Net imports rose from 3TWh in 2017 to 21TWh in 2019, and all such imports originate from countries with "zero or near-zero carbon pricing".
• Electricity imports resulted in significant carbon leakage. In 2019, imported electricity emitted an estimated 26 million tonnes of CO2, which is more than the annual emissions of Italy's coal fleet. If this electricity had been generated within the importing EU member states, emissions would have been 11 million tonnes lower due to their lower-carbon grids.
• There is a significant financial cost advantage for non-EU generators due to the lack of carbon pricing. Gross electricity imports in 2019 were valued at €1.6bn; had these imports been subject to the EU ETS carbon price, it would have generated €630m in revenue.
• Interconnection capacity between the EU and non-EU countries is planned to increase by 31% by 2030. This expansion includes new connections with five non-EU countries—Egypt, Tunisia, Libya, Israel, and Moldova—none of which currently have a carbon price. Additionally, 15% of this expansion is with the Western Balkans, a region containing some of Europe's most polluting power stations.
• Significant new coal capacity is being planned or built in countries connected or soon to be connected to EU grids, totaling up to 57GW. This represents a 53% increase in coal capacity for these countries. The largest planned increases are in Turkey (34GW), Egypt (11GW), Bosnia & Herzegovina (4GW), and Serbia (2GW).
• Several EU member states are particularly exposed to coal imports as they pursue domestic decarbonization. Greece is phasing out coal by 2028 but is connected to Turkey; Finland is the EU's largest electricity importer, sourcing from Russia; Spain is seeing rising coal imports from Morocco; Croatia is integrated with coal-developing Bosnia & Herzegovina; and Hungary is the largest EU importer of carbon-intensive electricity from Ukraine.

APA

Rosslowe, D. C., Moore, C., Jones, D., & MacDonald, P. (2020). The path of least resistance. Ember. https://ember-energy.org/app/uploads/2024/11/Ember-Path-of-least-resistance-2020.pdf

Chicago

Rosslowe, Dr Chris, Charles Moore, Dave Jones, and Phil MacDonald. The path of least resistance. Ember, 2020. https://ember-energy.org/app/uploads/2024/11/Ember-Path-of-least-resistance-2020.pdf.

Wikipedia

{{cite report |last1=Rosslowe |first1=Dr Chris |last2=Moore |first2=Charles |last3=Jones |first3=Dave |last4=MacDonald |first4=Phil |title=The path of least resistance |publisher=Ember |date=January 2020 |url=https://ember-energy.org/app/uploads/2024/11/Ember-Path-of-least-resistance-2020.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{rosslowe2020path, author = {Rosslowe, Dr Chris and Moore, Charles and Jones, Dave and MacDonald, Phil}, title = {{The path of least resistance}}, institution = {Ember}, year = {2020}, month = jan, url = {https://ember-energy.org/app/uploads/2024/11/Ember-Path-of-least-resistance-2020.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }