On 10 May 2023, the co-legislators signed the CBAM regulation, which entered into force on 17 May 2023. CBAM will initially apply to the import of certain products and selected precursors that are carbon-intensive and have the highest risk of carbon leakage in their production processes: cement, steel, aluminium, fertilizers, electricity and hydrogen. Products such as our cast iron pipes and fittings, stainless steel clamps and clamps, etc. are all affected. With the expansion of the scope, CBAM will eventually capture more than 50% of the emissions of the industries covered by the ETS when it is fully implemented.
Under the political agreement, CBAM will enter into force on 1 October 2023 during a transitional phase.
Once the permanent regime comes into force on 1 January 2026, importers will be required to declare annually the amount of goods imported into the EU in the previous year and their implied greenhouse gases. They will then surrender the corresponding number of CBAM certificates. The price of the certificates will be calculated based on the average weekly auction price of EU ETS allowances, expressed in euros per tonne of CO2 emissions. The phasing out of free allowances under the EU ETS will coincide with the gradual adoption of CBAM over the period 2026-2034.
In the next two years, Chinese foreign trade enterprises will seize the opportunity to accelerate their digital carbon emission collection, analysis and management systems and conduct carbon inventories of CBAM-applicable products in accordance with the CBAM accounting standards and methods, while strengthening coordination with EU importers.
Chinese exporters in related industries will also actively introduce advanced green emission reduction processes, such as our company, which will also vigorously develop advanced production lines for cast iron pipes and fittings, to promote the green upgrading of the cast iron industry.
Post time: Jun-05-2023