💥 LANDMARK STEP IN EU CLIMATE POLICY 💥
As part of its "Fit for 55 package", the EU has agreed on the new Carbon Border Adjustment Mechanism – short #CBAM – that will enter force in October 2023. Have you already heard of it? Don’t worry. Here is what you need to know.
🤔 What is the CBAM?
CBAM is designed to align the carbon price of imported goods with the price of carbon certificates that European companies must purchase for their products under the EU Emissions Trading Scheme (#ETS). Companies importing into the EU will be required to purchase CBAM certificates to make up the difference between the carbon price paid in the country of production and the higher price of carbon certificates in the EU ETS.
🚀 Why is this Big News?
Not only will the unprecedented law create new incentives for non-EU countries to increase their climate ambitions. It will also be the very first carbon pricing framework to address #Scope3Emissions, that is, indirect emissions in a company’s value chain. To date, those Scope 3 emissions aren’t directly priced. CBAM will change that and charge many EU importers for the first time a carbon price on their Scope 3 emissions.
🙌 This is just another example of the increasing focus on decarbonizing the supply chain. We are happy to support companies with our Climate Intelligence Platform to face this challenge and work together with their suppliers on reducing Scope 3 emission. Find out more on our website and book a call with us!
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Great measures to decarbonize the supply chain. This plays a big impact in influencing others to decarbonize their products.