Past Event

On gains, losses, and trade-offs: the case of Border Carbon Adjustment

How will the border carbon adjustment be implemented and what will be the implications?

Date: March 5, 2020, 12:30 pm Topic: Energy & Climate

Border Carbon Adjustment (BCA) is justifiably one of top priorities of the European Commission. With a ten-year deadline to drastically lower the GHG emissions, the Commission is planning to test the new measures already later this year, potentially starting with the industries producing steel, cement, and aluminum.

Inevitably, there is a lot of negative commentary surrounding the proposal – critics argue that the emerging countries’ industries will be put at a disadvantage, they wonder if the BCA is WTO-compatible, and finally, they question the very feasibility of the implementation of the tax.

At this event our fellow Georg Zachmann talked about his paper, “A European carbon border tax: much pain, little gain”, where he argues that the European Commission should not make the implementation of a carbon border adjustment mechanism into a must-have element of its climate policy.

There is little in the way of strong empirical evidence to offer justification for the problem the mechanism looks to address, direct carbon leakage.

Furthermore, significant logistical, legal and political challenges will arise during the design. A key problem with the limited form of adjustment currently under consideration will be trade deviation. The EU should instead focus upon the implementation of measures to trigger the development of a competitive low-carbon industry in Europe.

Video and audio recordings

 

Schedule

Mar 5, 2020

12:30-13:00

Check-in and lunch

13:00-13:20

Presentation

Georg Zachmann, Senior Fellow

13:20-14:10

Discussion

Chair: André Sapir, Senior Fellow

Gabriel Felbermayr, President, IfW Kiel Institute for the World Economy

Georg Zachmann, Senior Fellow

14:10-14:30

Q&A

14:30

End

Speakers

Gabriel Felbermayr

President, IfW Kiel Institute for the World Economy

André Sapir

Senior Fellow

Georg Zachmann

Senior Fellow

Location & Contact

Bruegel, Rue de la Charité 33, 1210 Brussels

Katja Knezevic

[email protected]

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