Nations launch carbon markets ahead of EU fee on high-emitting imports

illuminem summarizes for you the essential news of the day. Read the full piece on POLITICO or enjoy below:

🗞️ Driving the news: Nations are setting up carbon markets to avoid paying the EU’s upcoming carbon border tariff, which takes effect in 2026
• The tariff will apply to high-emission imports like steel, cement, and aluminum unless the exporting country has its own carbon pricing system
• The UK is also developing a similar carbon fee, expected to launch in 2027

🔭 The context: The EU’s Carbon Border Adjustment Mechanism (CBAM) is designed to prevent carbon leakage by ensuring imported goods face the same climate costs as EU-made products
• This policy encourages other countries to introduce their own carbon pricing to keep revenue within their borders
• Many nations see this as an economic opportunity rather than just a climate measure

🌍 Why it matters for the planet: By incentivizing global carbon pricing, the EU tariff could accelerate emissions reductions beyond Europe
• If more countries implement carbon fees, industries worldwide may transition toward greener production methods
• However, the effectiveness will depend on enforcement and global cooperation

⏭️ What's next: More countries may introduce carbon pricing mechanisms ahead of the EU’s 2026 deadline to retain control over revenue
• The UK’s carbon fee rollout in 2027 could further influence international climate policies
Ongoing trade negotiations will determine whether exemptions or adjustments will be made

💬 One quote: “You're essentially faced with the choice of paying the money to Europe, or collecting the money yourself.” — Nat Keohane, President of the Center for Climate and Energy Solutions

📈 One stat: The EU’s Carbon Border Adjustment Mechanism will apply to imports from countries without carbon pricing, covering industries responsible for over 30% of global emissions

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