Global Dialogue on Border Carbon Adjustments

The report examines border carbon adjustments (BCAs) as a tool to prevent carbon leakage, synthesizing views from stakeholders in five countries. It analyzes the risks of carbon leakage—specifically in Canada's heavy industry—and evaluates the design of the EU and UK CBAMs. Key discussions include the challenges of product-level emissions measurement, the need for revenue to support decarbonization in developing nations, and the potential for domestic carbon pricing as a strategic response to foreign BCAs.

• Canada faces a high risk of carbon leakage by 2030 in four specific sectors: iron and steel, basic chemicals, fertilizers, and pulp and paper, with a medium risk for cement, driven by an announced industrial carbon price of CAD 170/tonne by 2030.
• Stakeholders in Brazil, Trinidad and Tobago, the United Kingdom, and Vietnam argue that BCA revenues should be used for decarbonization and mitigating adverse effects, contrasting with the EU and UK plans to allocate these funds to general budgets.
• Measuring embedded emissions at the product level is identified as a significant challenge because national carbon pricing typically measures emissions at the facility level; consequently, stakeholders in Brazil and Trinidad and Tobago called for the recognition of international reporting standards like ISO and the GHG Protocol.
• Developing or accelerating domestic carbon pricing is viewed by stakeholders in Brazil, Trinidad and Tobago, and Vietnam as an effective response to BCAs because it allows countries to retain revenue domestically and reduces the fees paid to importing jurisdictions.
• Stakeholders in developing countries, particularly in Vietnam and Trinidad and Tobago, advocate for exemptions based on development level, citing the principle of Common But Differentiated Responsibilities and the specific needs of Small Island Developing States.
• The report identifies the linking of emissions trading systems (ETS) as a way to eliminate trade frictions, citing the existing agreement between the EU and Switzerland as a successful model that could potentially be replicated between the UK and EU.

APA

Bonnet, A. (2024). Global Dialogue on Border Carbon Adjustments. International Institute for Sustainable Development. https://www.iisd.org/system/files/2024-09/global-dialogue-border-carbon-adjustments.pdf

Chicago

Bonnet, Antoine. Global Dialogue on Border Carbon Adjustments. International Institute for Sustainable Development, 2024. https://www.iisd.org/system/files/2024-09/global-dialogue-border-carbon-adjustments.pdf.

Wikipedia

{{cite report |last1=Bonnet |first1=Antoine |title=Global Dialogue on Border Carbon Adjustments |publisher=International Institute for Sustainable Development |date=September 2024 |url=https://www.iisd.org/system/files/2024-09/global-dialogue-border-carbon-adjustments.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{bonnet2024global, author = {Bonnet, Antoine}, title = {{Global Dialogue on Border Carbon Adjustments}}, institution = {International Institute for Sustainable Development}, year = {2024}, month = sep, url = {https://www.iisd.org/system/files/2024-09/global-dialogue-border-carbon-adjustments.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }