EU’s carbon tax regime enters transitional phase
The EU’s effort to cut carbon emissions globally is going into high gear as the bloc’s Carbon Border Adjustment Mechanism (CBAM) entered its transitional phase on October 1.
As of October 1, the EU’s trading partners will have to report greenhouse gas (GHG) emissions embedded in six carbon-intensive exports, which consist of steel, cement, aluminium, fertiliser, hydrogen, and electricity. From 2026, they will also be required to purchase CBAM certificates to cover the GHG footprint, and the prices of CBAM certificates will be calculated based on the weekly average auction price of EU ETS allowances.
