UK and EU advance Carbon Border Adjustment Mechanism frameworks

European and British authorities and industry groups are advancing Carbon Border Adjustment Mechanism (CBAM) frameworks to address carbon leakage.

The UK government has released indicative calculation metrics for its upcoming CBAM, scheduled for 2027. The UK approach utilizes a simplified methodology, applying sector or global averages for calculation values rather than the high-specificity requirements seen in the EU model. This system aims to mirror the costs domestic producers pay under the UK Emissions Trading Scheme (ETS).

In the European Union, the CBAM is entering a definitive period. Importers of high-emission goods—such as cement, iron, steel, aluminum, fertilizers, electricity, and hydrogen—must obtain authorization and purchase CBAM certificates. The first annual declarations for 2026 emissions are due by September 30, 2027, with certificate sales beginning in February 2027.

Simultaneously, EUROMETAL and 19 other industry associations have signed a joint statement urging EU policymakers to extend CBAM coverage to downstream products. The signatories argue that without including finished and semi-finished goods, European manufacturers in sectors like construction, machinery, and mobility will face higher carbon costs than international competitors, potentially leading to industrial relocation.