This opinion will provide the civil society perspective on the Carbon Border Adjustment Mechanism. The main purposes of the Carbon Border Adjustment Mechanism (CBAM) would be to discourage EU businesses from moving their production to countries with less ambitious climate change policies (carbon leakage) and to encourage a global move towards net zero carbon emissions by 2050 in line with the Paris Agreement.
Carbon markets: Emergence, structuring and challenges for European industry (own-initiative opinion) - Related Opinions
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Trade Policy Review - An Open, Sustainable and Assertive Trade Policy
The EESC believes that there are well-founded reasons to establish uniform rules within the EU to combat global warming and based on these to embark on international discussions with other trading blocs. Furthermore, the Committee deems that, in the future, it could be useful and necessary to also devise new taxation measures that can supplement the current emissions trading system and national carbon taxes in order to achieve an effective and symmetrical policy framework to tackle the increasing amount of CO2 emissions.
The European Union and its Member States must stand united to protect their sovereignty. The EESC firmly believes that if Europe is to maintain its leading role in the world, it needs a strong, competitive industrial base. The EESC recognises the crucial importance of shifting to a carbon-neutral economy and of reversing the current curve of biodiversity collapse. Without a green industrial strategy as a cornerstone of the Green Deal, the EU will never succeed in reaching a carbon-neutral economy within one generation. The new industrial strategy must ensure the right balance between supporting European businesses, respecting our 2050 climate neutrality objective and providing consumers with incentives to shift consumption to sustainable goods and services .
The opinion will provide guidance on how to build on existing structures like citizens' dialogues and assemblies, social dialogue committees in order to structure and mainstream the dialogue with civil society. It will also make recommendations about how to encourage information sharing and public understanding of climate action; how to create real and virtual spaces for exchange on climate and how to build capacity to facilitate grassroots initiatives, among others.
The transition to a low-carbon economy is the EU's goal and obligation and the EU committed itself to implement this transition in a socially just and cost-effective manner. It is thus important to examine all the feasible ways of financing climate neutrality, and possibly find new and innovative financing models in the near future.
The EESC welcomes the initiative of the European Commission (EC) to launch the assessment of the draft National Energy and Climate Plans (NECPs) submitted by the Member States, thereby following up on the new governance model launched by the Council and the Parliament in December 2018 and aimed at ensuring the transition to clean energy and climate protection through a multilevel interactive dialogue which fully involves civil society and public and private entities at local and regional level. The EU is the first major global economy to adopt, through specific National Energy and Climate Plans, a legally binding framework to deliver on its 2015 commitments under the COP21 Paris Agreement and the UN 2030 Agenda.
European industrial, energy and climate policy is hampered by contradictory requirements on the price for Greenhouse effect Gas (GHG) emissions: on the one hand, high prices would be necessary to incentivise investment and changes in consumption patterns; on the other, the preservation of the external competitiveness of EU energy-intensive industries, as well as the prevention of “carbon leakage”, would require low prices.
The proposed own-initiative report investigates the technical and legal feasibility of Border Adjustment Measures for the internal price of GHG emissions: importers pay the price, exporters get it refunded, as it already is the case for VAT. The refund of the GHG emission price to exporters could be based on a VAT-like accounting system. The GHG emission price paid by importers could be based on the basic metals and materials content of the product. This system would be in line with WTO rules, and rely upon fully proven methodologies.
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