'Green tariffs': what are they and why are they important?

Why are they necessary?

The reduction of carbon entails costs for some industries, particularly those that currently rely heavily on fossil fuels, such as steelmaking, or that emit carbon as part of its processes, such as the production of cement and concrete.

If a government forces its industry to reduce carbon while others do not, companies based in the country with lax regulations will be able to outperform those in cleaner countries with cheaper products. This could mean that cheaper products will be sold in greater quantities – emitting more carbon in the process – so that there is no overall reduction in carbon released into the atmosphere, while industries in the cleanest countries suffer without climate benefits.

For this reason, governments may impose costs or other barriers on imports. These business regulations are known as carbon border taxes, carbon boundary adjustment mechanisms (CBAMs) ou green tariffs.

With its application, imports of certain products would be subject to taxes that would increase their price, creating equitable conditions between countries where industries are subject to trade regulations. carbon and those where they are not.

“Carbon tax” for greener industrial imports; see other highlights Curto Verde

See highlights from Curto Green: ➡️ European Union announces “carbon tax” agreement for industrial imports; ➡️ Startup seeks to bring food production closer to urban centers, for the benefit of the environment; ➡️ Deforestation in the Amazon explodes in November: Inpe data shows 554,66 km2 deforested; ➡️ Is planet Earth currently experiencing the 6th mass extinction? Some experts believe so and say humanity is to blame; ➡️ Krenak indigenous people face the BHP group in British justice over tragedy in Mariana/MG.

Why not create a global tariff?

The creation of a global price for carbon – which would be charged to all companies per ton of CO2 produced in their operations – would be a much simpler solution. However, discussions on the topic have been going on for decades, without anything being effectively decided.

For this reason – and due to the climate emergency we are experiencing – some governments have decided to act on their own, creating their own green tariffs.

And what happens now?

The EU took the lead in creating a green tariff (CBAM), by agreeing to make the reporting carbon a requirement in sectors such as iron and steel, cement, fertilizers, aluminum, electricity and hydrogen. If the still provisional agreement is approved, a testing phase will begin from October 2023.

The countries most likely to face green tariffs These are those with large consumption of fossil fuels and large polluting export-oriented industries, such as China, Australia, Turkey and India.

Curto curation:

• EU to impose world's first 'carbon tariff' on environmentally harmful imports (euronews.green*)

Read also

European bloc reaches broad agreement on carbon market reform

MEPs and Member States of the European Union (EU) reached an agreement this Sunday morning (18) on a broad reform of the carbon market, a key part of the bloc of 27's climate plan. The plan seeks to accelerate emissions reductions and it is a leap forward in the ambitions of the current European carbon market, gradually eliminating the free “polluting rights” attributed to industry.

Products coming from deforested areas will no longer be imported, EU decides

This Tuesday (05), the European Union (EU) announced an agreement that prohibits the import of products that have contributed to deforestation, such as cocoa, coffee or soy. The decision was taken on the eve of the start of COP15 on Biodiversity in Canada.

(🚥): may require registration and/or signature 

(🇬🇧): content in English

(*): content in other languages ​​is translated by Google Tradutor

Curto Explain: everything you need to know and are embarrassed to ask!😉

Click here to see more explanatory content ⤴️