PERTH (miningweekly.com) – The Minerals Council of Australia (MCA) has cautioned on the use of a carbon tariff on imported materials, as the European Commission adopted a proposal for a new Carbon Border Adjustment Mechanism (CBAM).

The CBAM will put a carbon price on imports of a targeted selection of products so that ambitious climate action in Europe does not lead to ‘carbon leakage’, and this would ensure that European emission reductions contribute to a global emissions decline, instead of pushing carbon-intensive production outside Europe.

The European Commission noted that it was also aimed at encouraging industry outside the European Union (EU) and its international partners to take steps in the same direction.

The CBAM will equalise the price of carbon between domestic products and imports and ensure that the EU’s climate objectives are not undermined by production relocating to countries with less ambitious policies, the Commission said.

MCA CEO Tania Constable this week noted that achieving net zero emissions required a concerted effort on new technologies, not trade protection.

She noted that the proposed EU CBAM as sketched in documents released by the EU Commission was essentially a tax on imported energy intensive products.

“Proposals to tax imports of iron, steel, aluminium, cement, fertilizer and electricity under the current proposal need to fairly take into account different ways other countries are managing the reduction of carbon emissions in their economies.

“Australia has a good story to tell. Australia is leading the world in the uptake of renewable generation, ten times the world average, according to the Australian Energy Market Operator. Australian mining recognises the monumental task of lowering emissions. Our members have embraced the challenge and support the Paris Agreement and the transition to net zero emissions.

“Miners in Australia have already progressed over 39 abatement activities including the installation of renewable energy and battery storage, hydrogen fuel cell use, fugitive emissions capture and conversion, fuel switching as well as capturing energy savings through process efficiency improvements,” Constable said.

She added that these initiatives were delivering emissions reductions now, not seeking to shift the burden through trade disruptive policies scheduled to take effect years into the future, and highlight the advantage of technology research and deployment in achieving emissions reductions.