This report examines the proposed United Kingdom Carbon Border Adjustment Mechanism in the context of the European Union's CBAM and the United Kingdom's relationship with trading partners. It assesses impacts on industries and stakeholders, incorporating insights from extensive consultations. It addresses implementation challenges, including impacts on exports, economic activity, and employment, and it emphasizes balancing climate action with equity through international collaboration.
Authors
- Pages
- 39
- Published in
- Canada
- Rights
- IISD, 2024
Table of Contents
- 1.0 Introduction 9
- 1.1 The EU CBAM 11
- 2.0 The United Kingdom Context 13
- 2.1 Brexit and British Climate Policy 13
- 2.2 The UK ETS 14
- 3.0 The United Kingdom’s Reaction to the EU CBAM 16
- 3.1 The Proposed UK CBAM 17
- 3.2 The Implications of the EU CBAM for the United Kingdom 19
- 4.0 Risks 27
- 4.1 Implementation and Operation Risks 27
- 4.2 International Reputational Risks 28
- 5.0 Conclusions 30
- 5.1 CBAM Alone Is Not Enough 30
- 5.2 Interactions Between the EU and UK CBAMs 30
- 5.3 Implications Beyond Europe 31
- References 33
- Figure 1. United Kingdom and EU ETS carbon pricing 14
- Table 1. Trade flows between the EU and the United Kingdom in CBAM-affected products in 2022 (GBP million in 2022) 20
- Box 1. A summary of responses to the United Kingdom government consultation, Addressing Carbon Leakage Risk to Support Decarbonisation 17
- Box 2. Proposed UK CBAM design and implementation 18
- Box 3. The EU CBAM’s impact on Northern Ireland 23
