Article by Eric Worrell
If renewables are the cheapest form of energy, why does the EU need a carbon border tax to protect EU industry?
Q&A: Can the Carbon Border Adjustment Mechanism help combat climate change?
The EU's Carbon Border Adjustment Mechanism (CBAM) has been hailed as a key policy to reduce emissions from heavy industry such as steel and cement production.
The EU says taxing carbon-intensive imports will help its domestic companies take ambitious climate action while still remaining competitive with companies in countries with less stringent environmental laws.
There is evidence that CBAM is also pushing other governments to introduce stricter carbon pricing policies to avoid paying border taxes to the EU.
It could also help shape climate change and elevate the international climate agenda, potentially helping to boost ambition more broadly.
However, the new tax measures have stirred controversy at a time of growing protectionism and economic competition between major powers.
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The analysis also shows that the EU's CBAM alone will have a limited impact on global emissions.
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If countries lose carbon-intensive businesses because they close or choose to do business elsewhere, this could harm the economies of countries trying to implement carbon pricing. At the same time, if domestic manufacturing is simply replaced by carbon-intensive imports, it could increase global emissions.
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Learn more: https://www.carbonbrief.org/qa-can-carbon-border-adjustment-mechanisms-help-tackle-climate-change/
The hallmark of cheap energy is that you can make products at a lower cost than anyone else. Why impose a carbon tax on imported goods if their goods are already cheaper than others?
China dominates global manufacturing because its low-cost coal economy gives them a competitive advantage.
If the cost of manufacturing an energy-intensive product is 50% energy + 25% materials + 25% labor, then halving energy costs reduces manufacturing costs by 25%.
No such transformation has occurred in the EU. The EU is an economic hellhole where ordinary consumers are punished by the carbon border adjustment tax with higher prices mandated by law. Imposing a border adjustment tax like this is all the evidence anyone should need that renewable energy is an extremely expensive form of energy.
If renewable energy did provide the EU with cheap energy, the EU would not need to impose border taxes to prevent cheap imports from undercutting and undermining EU manufacturing. If renewables have the ability to provide cheap energy, renewable energy-driven manufacturing hubs will spring up across the EU, flooding the world with low-cost energy-intensive products that not even China can undercut.
Any day now, right? Do I need the /sarc tag?
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