European Aluminum Industry Gearing up for CBAM

    The European aluminum industry isgearing up for the implementation of CBAM, which will take effect in 2026. This initiative aims to impose a carbon price onimported aluminum, aligning it with EU-produced goods under the Emissions Trading System. However, industry leaders express concerns that the mechanism could exacerbate existing challenges, including high electricity costs and regulatory pressures that have already led to the closure of approximately 1.18 million metric tons of production capacity since 2021.

    Producers are particularly worried about the double-reporting requirements and administrative burdens associated with emissions data collection. They advocate for robust third-party verification to ensure compliance and prevent circumvention ofthe rules. The CBAM could disadvantage EUsmelters operating on low-carbon electricity, as non-EU producers might benefit from lower operational costs. They called for the product scope to be expanded to more aluminum products and other materials. Products outside CBAM scope are at clear risk of carbon leakage.

     Stakeholders emphasize the need for awell-designed CBAM that includes indirect emissions in its scope without compromising the competitiveness of European producers. While there are hopesthat CBAM could drive innovation ingreener technologies, its success hinges oncareful implementation and addressing potential loopholes that may lead to carbon leakage.

From: https://www.fastener-world.com/en/article/9044.html