Change Partnership
Change Partnership is a not-for-profit thought-leadership and activist organisation seeking to solve the politics of climate change to facilitate the transition to a clean, secure and prosperous world.
ID: 027333110679-45
Lobbying Activity
Response to Carbon Border Adjustment Mechanism
31 Mar 2020
Change Partnership is a not-for-profit thought-leadership and mission-orientated organisation seeking to solve the politics of the climate crisis.
We do not support a carbon border adjustment mechanism on the basis that it:
- does not ‘protect’ the EU economy,
- is not in the interest of consumers and wider society, and
- it does not create the positive political conditions and framework needed to build a global consensus to tackle the climate crisis.
The following aspects must be take into consideration in the impact assessment and any subsequent policy design:
a) Politics: Protectionist measures tend to sour political discourse, trust and confidence in delivering the end goal of decarbonisation to stay below 1.5 degrees. For example, Narenrada Modi, Indian Prime Minister, stated “there should be no place for unilateral steps that become economic barriers for others” at the opening of COP21 where agreement was reached on a new global climate architecture. The US Commerce Secretary Wilbour Ross warned “Depending on what form the carbon tax takes, we will react to it” whilst He Jiankun from Tsinghua University, a delegate for the Chinese government, stated "Currently adopting this type of cross-border measure could influence the friendly atmosphere of cooperation in the process of confronting climate change."
The EU impact assessment must outline border measures advance trust, cooperation and international efforts to accelerate climate action.
b) A credible threat? The EU introduced a carbon border measure for all international air travel arriving and departing from the EU in 2009. Significant global political pressure from the US, China and India crushed this measure. President Obama approved the Thune Bill which prohibited US airlines from complying with the EU ETS Aviation legislation. China and India also did the same with their airlines. China then threatened to delay and possibly cancel its order for 55 Airbus planes, which ultimately forced the French government to seek a delay to in the enforcement of EU legislation.
There is no indication that the EU is in a stronger position to fend off these countries as well as Brazil, Russia and others, and this time on three sectors. Failure would render the whole exercise worthless, damage the EU’s credibility and isolate it at a time when it must drive global cooperation to tackle the climate crisis.
c) Asymmetrical retaliation: China delaying and threatening to cancel Airbus orders was an example of direct retaliation confined to the same sector. Most trade war retaliation is asymmetrical. For example, China stopped purchasing US agricultural products namely soybeans, the most valuable American crop export, in response to US tariffs on Chinese steel imports. This hammered the $9.1 billion yearly export market but the plight of farmers cost the US economy $28 billion for just two years of compensation. Furthermore, the steel tariffs are expected to cost US dairy famers $12.8 billion by 2023.
The EU’s impact assessment will have to calculate the potential economic impact of retaliatory measures across the EU economy.
d) Competition concerns: Cement and steel, two of the sectors expected to benefit from a CBAM have a long history of anti-trust and price fixing in the EU. This has done considerable harm to the functioning of the Internal Market, public policy and citizens considerable harm. If a few companies can control access to the EU or national markets it implies that they are not truly exposed to domestic or international competition undermining the case for border measures in the first place.
Examples of cartels include:
i) The ‘Cembureau Agreement’;
iii) The ‘Thyssenkrupp, Voestalpine, Vossloh and Mora cartel in Germany; iv) ‘Club Europe’ steel cartel which ran from 1984 to 2002.
Read full responseResponse to Climate Law
6 Feb 2020
Change Partnership is a not-for-profit thought-leadership and mission-orientated organisation seeking to solve the politics of climate change to facilitate a clean, secure and prosperous world.
We welcome this opportunity to comment on a proposed European Climate Law which institutionalises achievement of a zero-carbon emission EU by 2050. The climate crisis is central to all and addressing it must be the orientation for all EU actions and activities.
We recommend:
Definition: ‘carbon neutrality’ is vague and will lead to a confusing and misleading legislative framework. Therefore, the legal definition of the target should be ‘zero-carbon’ which refers to all non-negligible quantities of CO2e from production sources.
2050 targets: The EU must set two separate targets for 2050. The first relates to the need to remove all direct CO2e emissions from production processes in the EU before 2050.
The second target should mandate the rules, definition and process for permanent removal of CO2e emissions from the atmosphere. This avoids offsetting abatement, which increases the climate crisis rather than solves it.
Once the 2050 zero-carbon target is achieved it will be redundant and replaced by the carbon removal target.
Periodic review: The window to avoid catastrophe is closing fast. Every year the UN produces an Emissions Gap Report which gives an indication of the emission reductions required to avoid disaster. This is the best measure of the required emission reductions and must be the yardstick to guide targets and timing set by the EU. These targets must be discussed on the same cycle as the Article 14 ‘Global Stocktake’ timing outlined in the Paris Agreement.
2030 targets: The EU’s climate target must be set by climate science not politics. The UN EP Emission Gap Report 2019 indicated that all parties of the Paris Agreement must reduce emissions by 7.6% annually. The Commission must propose an emission target around 65% to be within this range.
The 50% reduction target muted by the Commission President is inadequate when measured against what is required to solve the problem and therefore must not the basis for discussion or a legislative proposal.
End fossil fuel subsidies: All direct and indirect fossil fuel appliance and infrastructure subsidies should be removed before the end of this mandate. There is no justification for the Commission and EU to continue to finance fossil fuels. Often these are supported under the guise of social payments to avoid unrest and maintain harmony. Given the indiscriminate nature of climate damages incidents, its costs as well as the reduction of life expectancy directly linked to fossil fuels, these social payments need to be displaced by a programme of mandated upgrades of buildings and industry to accelerate the displacement of fossil fuel use by renewable energies.
Aligning public finance to delivering climate targets: The EU is central to guiding public finance and catalysing private capital. All public finance should be geared towards rapid deployment of abatement solutions across the economy.
Significance of the energy system: Whilst considerable effort has been made in decarbonising the energy system, it is still perilously dominated by fossil fuels. Targets for energy system decarbonisation must be increased and made mandatory for 2030 as this sector can and must decarbonise much earlier than others. Much of the decarbonisation effort in other sectors such as transport and industry also requires a removal of fossil fuels from the energy system adding to the need to prioritise legislation in this sector.
We look forward to working with you to design an effective EU Climate Law.
Read full responseMeeting with Miguel Arias Cañete (Commissioner) and Transport and Environment (European Federation for Transport and Environment) and
11 Mar 2016 · Implications of the Paris Agreement in the EU climate and energy policies