Brussels, 17.05.2022 - Today, the Committee on the Environment, Public Health and Food Safety (ENVI) voted on key parts of the EU's climate action package ("Fit for 55"). Particular attention was paid to the proposal for a Carbon Border Adjustment Mechanism ( CBAM). This climate protection measure is intended to prevent the risk of carbonleakage, support the EU's ambitious climate protection targets and be in line with global trade rules.

As shadow rapporteur for CBAM, ÖDP MEP Manuela Ripa has been in charge of negotiating the legislative proposal with the other political groups in the European Parliament on behalf of her Greens/EFA group in recent months.

"With today's vote, we are putting forward a global solution to climate change. To set global standards, the EU must use instruments that reward low CO2 levels and make high carbon levels more expensive."

Manuela Ripa welcomes the fact that the EU Parliament was able to make important additions to the Commission's original proposal. "We have achieved that the taxation mechanism will enter into force one year earlier, namely from 2025. From this date, CBAM will be introduced gradually, while the free allowances of the EU Emissions Trading System (EU ETS) will be phased out in the sectors covered by CBAM ."

Parliament is in favor of reducing the free allowances by 10% from 2025 to 2027. A reduction to 50% is then to take place from 2028 and to 25% in 2029. Manuela Ripa affirms: "From 2030, no more free allowances will be allocated." By January 2030, the scope of the CBAM is to be the same as the sectors covered by the EU ETS.

The report also creates the basis for the establishment of a CBAM authority that will strictly monitor and punish attempts at fraud and circumvention. "This is definitely a more efficient alternative to the existence of 27 individual national authorities," Manuela Ripa is convinced. This could also avoid the risk of circumvention (forum shopping) and increase efficiency at the same time.

"We were also able to extend the scope of CBAM to other sectors, such as polymers, hydrogen and ammonia."

In addition, indirect emissions resulting from the generation of electricity used in the production of goods are also to be included from the outset. "In order to achieve our climate targets, it is crucial that CBAM reaches as far as possible and covers as many areas as possible," explains Manuela Ripa.

"To combat the climate crisis, we must not leave the least developed countries behind in the global decarbonization process. I am therefore delighted that we have managed to negotiate financial support for these countries to convert their industry.

I see this as a major gain in the fight for social justice in supporting climate protection and adaptation to climate change," explains the MEP.

The amount set annually should at least correspond to the amount of revenue from the sale of CBAM certificates so that this revenue can be used to finance climate protection measures on the ground in the least developed countries.

"Last but not least, we have also agreed that the Commission will closely monitor the development of possible carbon leakage effects in exports from the EU and, if necessary, propose measures that are compatible with world trade law.

All in all, we have found an excellent basis for the implementation of the European Green Deal. We have adopted an instrument that reduces greenhouse gas emissions globally, prevents carbon leakage, keeps our industry competitive and ensures compatibility with global trade rules. Now it all depends on the vote in plenary at the beginning of June. I very much hope that the compromises reached will not be watered down." 

Background: "Fit for 55" contains a series of legislative proposals aimed at reducing net greenhouse gas emissions by at least 55% by 2030. The Carbon Border Adjustment Mechanism is part of "Fit for 55" as well as a key measure of the European Green Deal. CBAM aims to reduce the risk of carbon leakage by incentivizing manufacturers in non-EU countries to make their production processes more environmentally friendly. The CBAM complements the EU ETS. It is also based on a system of allowances for CO2 emissions generated in the manufacture of products that are subsequently imported into the EU, i.e. EU importers buy allowances equivalent to the CO2 price that would have been paid if the goods had been manufactured under EU rules for pricing CO2 emissions. A higher CO2 content leads to higher taxation, a lower one to exemption from taxes.