The EU’s Carbon Border Adjustment Mechanism (CBAM) is not a business-as-usual instrument that allows sectors to delay decarbonisation. It applies a levy on imported goods equal to the internal EU ETS-related carbon price, so that both EU-produced goods and those imported into the EU face similar carbon cost pressures. But sectors must use the CBAM phase-in period to decarbonise. Pablo Ruiz and Barbara Kölbl at Rabobank look at how different … [Read more...]
CBAM is now active. A guide to what companies must do to comply
On October 1st 2023 the Carbon Border Adjustment Mechanism (CBAM) became effective. Its purpose is to limit carbon leakage by establishing a carbon price on imported goods that is equivalent to the carbon price on domestically produced goods. That means introducing a set of reporting and compliance obligations for importers of goods into the EU. Simon Göss and Hendrik Schuldt at carboneer explain the new mechanism and scope (aluminium, cement, … [Read more...]
Industry’s EU ETS reforms and CBAM: how firms can turn the rising cost of carbon into competitive advantage
Changes to the EU ETS mean free emissions allowances (EUAs) for industry will be gradually phased out as the Carbon Border Adjustment Mechanism’s (CBAM) CO2-related levy will be inversely phased in. It means the carbon costs for industry in the EU will significantly rise. Pablo Ruiz at Rabobank takes a deep dive to assesses the magnitude of these changes and their implications for the main industrial sectors, and the main change drivers for … [Read more...]
Rooftop Solar for industry: up to 35% of U.S. manufacturing sectors could supply all their own power
Rooftop solar could supply the complete electricity needs of 5-35% of U.S. manufacturing sectors, explains Matthew Eckelman at Northeastern University who summarises his co-authored paper “Technical feasibility of powering U.S. manufacturing with rooftop solar PV”. At present, only 0.1% of industrial electricity demand in the U.S. is supplied by on-site sources of renewable energy. But large, unobstructed industrial rooftops and the declining … [Read more...]
Carbon Capture: how all Germany’s captured CO2 can be used by the Chemical industry
The German government is promising to publish a strategy on carbon capture, opening a door that has previously been closed to developing this technology. In the first of a series of articles, Simon Göss and Hendrik Schuldt at carboneer look at why the nation is changing its mind, before laying out the reasons why carbon capture will be essential for Germany to meet its emissions goals. Unlike the power grid, there’s no easy way to decarbonise … [Read more...]
Iron and Steel: how can Hydrogen and Direct Electrification replace fossil-based production?
Karan Kochhar, Luis Janeiro and Francisco Boshell at IRENA look at the decarbonisation of iron and steel. They account for about 7% of global energy–related carbon emissions. The authors explain what’s needed for green hydrogen and direct green electrification to take over from traditional fossil-based production. Many projects are in the pipeline, and the authors reference case studies like H2 Green Steel, SIDERWIN and Boston Metal. Though that … [Read more...]
“Book and Claim”: how end consumers can pay distant producers for low carbon products
In long logistical chains (found in steel, concrete, aviation, shipping and others) end consumers that want to pay a premium to cut their emissions (for example to comply with corporate decarbonisation promises) often have no way to pay the first link in that chain to go low-carbon. “Book and Claim” creates a market to do that. Consumers buy certificates, and producers get the money to fulfil the commitment. And a working system will bring to … [Read more...]
Steel, Aluminium: 20% of emissions reductions target must come from Recycling. How?
Recycling is needed to achieve 20% of the emissions reductions targets for the steel and aluminium sectors. It’s an integral part of the 1.5°C climate-aligned decarbonisation pathways in many metal sectors, explain Sravan Chalasani, Wenjuan Liu and Lachlan Wright at RMI. For aluminium products, the share that comes from post-consumer scrap needs to increase from 21% in 2020 to 46% by 2050. Recycling is already a reality, but reporting and … [Read more...]
Adding ordinary baking soda to concrete production can cut 15% of its CO2 emissions
Concrete production makes up 8% of global CO2 emissions. Half comes from the fossil energy used to make it (which, hopefully, can transition to clean power), and the other half comes from the CO2 that escapes during the chemical transformation. David Chandler at MIT describes research there that shows how simply adding sodium bicarbonate (yes, the baking soda you put in your cookies) during the early stages of production can remove, by … [Read more...]
Embodied Carbon Emissions: understanding the different methodologies being used around the world
The measurement of the embodied carbon emissions of goods tells us what greenhouse gas emissions are generated during the production and transportation of those goods. This achieves two main things. Firstly, it allows producers to understand where their emissions are coming from, and so reduce them. Secondly, it opens the door to putting a price on those emissions, thus incentivising producers to reduce them. But, as Max Gruenig at E3G explains, … [Read more...]
Steel decarbonisation: Australia must stop making excuses and follow Europe’s lead
Australian steel makers, major global exporters, must stop making excuses about decarbonisation and look to Europe for a role model, argues Simon Nicholas at IEEFA. A pattern of behaviour by Australia’s steel makers reveals that their excuse is that low-carbon solutions are not yet ready, leaving only promises of carbon capture (as yet unproven at scale) some time in the future. Nicholas notes that these promises will never have to be kept by the … [Read more...]
The U.S. should support the EU’s Carbon Border Adjustment Mechanism (CBAM)
The U.S. should get behind Europe’s Carbon Border Adjustment Mechanism (CBAM), says Joseph Majkut at the Center for Strategic and International Studies. Under the EU’s newest agreement, anyone importing CBAM-listed goods into Europe will have to report the emissions associated with their products starting in October, and ultimately face tariffs if those emissions exceed those of the equivalent products made in the EU. The current list is iron and … [Read more...]
Concrete: 8% of global emissions and rising. Which innovations can achieve net zero by 2050?
Concrete manufacture is responsible for 8% of global carbon emissions, with the ingredient “clinker” accounting for most of it. Global demand for cement (which hardens into concrete) is expected to increase 48% from 4.2bn to 6.2bn tons by 2050, mainly driven by developing nations. China used more concrete between 2011 and 2013 than the United States did in the entire 20th century. Ben Skinner and Radhika Lalit at RMI look at the materials and … [Read more...]
EU ETS and CBAM: what the big update to emissions trading rules means for Europe’s key sectors
The EU’s Emissions Trading Scheme is a vital part of the region’s decarbonisation plans. Simon Göss at carboneer digs into the new rules coming in for the existing EU ETS, and the implementation of the new carbon border adjustment mechanism (CBAM). Right now, the existing EU ETS covers around 40% of the EU’s emissions (energy sector, industrial installations and aviation). Its scope is being extended to include maritime transport. On top of that, … [Read more...]
Corporate targets are forcing suppliers to cut emissions or relocate to clean energy nations
Emissions targets being imposed by corporates in the U.S. and Europe are forcing manufacturers in other parts of the world to decarbonise, writes Kwangyin Liu at Clean Energy Wire. Here, she looks at how Taiwan’s TSMC – the world’s third largest chip manufacturer – is having to set up factories in Arizona (U.S.) and Kumamoto (Japan) where emissions are lower and thus to comply with requirements set by customers like Apple, Google and Microsoft. … [Read more...]
