The European Parliament has formally adopted changes to the EU's carbon border adjustment mechanism (CBAM), removing 90pc of firms originally covered by its scope while still targeting 99pc of the greenhouse gas (GHG) emissions from CBAM products.
EU climate commissioner Wopke Hoekstra told parliament that he expects to finalise work on adapting CBAM for exports, as well as expanding the scope to cover other sectors, by the end of this year. CBAM currently covers emissions embedded in products imported into the EU from the aluminium, cement, iron, steel, electricity, fertilizers, ammonia and hydrogen sectors, as well as certain downstream products and indirect emissions under certain conditions.
The changes to CBAM were adopted by a large majority of 617 votes for, 18 against and 19 abstentions. The text is expected to be approved by EU states in the coming weeks.
During the debate, calls were issued for the European Commission to clarify the "additional flexibilities" outlined for CBAM in an EU and US joint statement issued in August. EU officials then said the bloc has not committed to change CBAM in any specific way, nor to provide more favourable treatment to US firms covered by CBAM.
"The signals that the commission has hinted at, the extra flexibility for [US president Donald] Trump in CBAM, deeply concern me," Mohammed Chahim of parliament's centre-left S&D group said. "If the commission starts undermining CBAM by doling out perks before it has even been fully entered into force, then the credibility of the entire system is at risk," Chahim said, who is parliament's negotiator for the final text of the CBAM regulation in 2023.
"This proposal aims to protect European businesses against hostile economic policy from polluting countries and, in this specific case, the US that has also imposed tariffs of between 30-50pc precisely on products covered by the CBAM," parliament's environment committee chair Antonio Decaro said.
With the EU only producing some 6-8pc of global emissions, Filip Turek of the far-right Patriots for Europe group said the bloc is punishing itself with CBAM. "I have one solution for you — cancel all emission targets, taxes and tariffs. Cancel the Green Deal," Turek, who drafted the energy committee's opinion on CBAM reform, said.
