EEX welcomes the Green Deal and increase of the 2030 ambition as a pivotal step for Europe to achieve climate neutrality and assert its role as global climate action leader. Energy markets, and in particular power and emissions markets, will be a key instrument in delivering on Europe’s long-term climate ambitions.
European energy and emissions markets cannot be considered in isolation, especially when it comes to decarbonisation. If well designed, a carbon border adjustment mechanism (CBAM) can be one element in a broader package of climate policies and support European competitiveness. The global policy landscape is gradually moving closer towards the vision of global carbon pricing. This offers significant potential for cooperation between trading schemes, which should be the priority for stakeholders around the world. In this way, a CBAM could be a transitional tool towards equivalent domestic carbon pricing systems.
A CBAM must however be carefully designed and particular attention should be paid to minimizing the risk of global trade disruptions. Equally important, the CBAM should be as closely as possible integrated with the existing EU Emissions Trading Scheme after a careful assessment of the complexity and effectiveness of different policy configurations or sectoral integration.