UK energy minister Ed Miliband told a parliamentary committee today that work should be accelerated on including refineries in the country's carbon border adjustment mechanism (CBAM).
"We want to accelerate the work to get refineries into the CBAM, because that is the way in which we can help to protect their competitiveness," Miliband told a meeting of the energy security and net zero committee today, adding that his department is working on this with the finance ministry.
"We recognise that the situation facing refineries is really challenging," Miliband said, adding that the energy ministry is also considering the lack of inclusion of refineries in the energy-intensive industries exemption scheme, which is designed to reduce electricity costs in covered sectors.
Miliband also pointed to the future of fuels call for evidence, to be launched "shortly", which he said will address the role of the refining sector.
The UK CBAM is to launch on 1 January 2027, initially covering aluminium, cement, fertilisers, hydrogen, iron and steel. Glass and ceramics were initially included, but have since been excluded subject to future review, as have indirect emissions, until 2029 at the earliest.
After the Prax Lindsey refinery fell into administration last year, refinery association Fuel Industry UK's chief executive, Elizabeth de Jong, said "we must now see a shift towards delivering the changes that can make a difference — inclusion in CBAM and addressing hugely expensive industrial energy and carbon costs".
The government yesterday opened a consultation running to 24 March on draft delegated regulations for administrative implementation of the UK CBAM, including a proposed methodology for calculating carbon price relief.
