Republican Senators Urge WH to Argue Against EU Carbon Border Adjustment
More than a third of Republican senators are telling President Joe Biden that the European Union's plan to apply tariffs to aluminum, cement, fertilizers, iron and steel from countries that are not pricing carbon as the EU does is protectionism in disguise. They noted that U.S. steel is already more carbon efficient than the product is in the EU.
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Their letter, led by Sen. James Lankford, R-Okla., and Sen. Kevin Cramer, R-N.D., says that the Republicans agree that preventing businesses from moving production to countries "with less rigorous environmental systems" is an important goal. But they said, " As we understand it, the [EU's carbon border adjustment mechanism (CBAM)] would only credit explicit carbon pricing in the country of origin and not any other policies to reduce emissions. In practice, the scheme would only provide blanket national exemptions to trade partners with linked carbon trading systems to the EU’s emissions trading system, such as Norway and Switzerland."
They also said that the proposed requirement for exporters to provide a customs declaration with detailed information on the carbon intensity of their products is beyond the ability of many U.S. companies, and that it's unfair that in the absence of that information, the EU would apply the average carbon intensity for U.S. production of that good. "For a country the size of the United States, which has a varying electricity generation mix from one state to the next, this standard could penalize manufacturers powered by carbon-free nuclear energy or hydropower," they wrote.
"The United States should not allow the EU to define a climate and trade standard it has not helped shape," they wrote. "We have been a leader in addressing climate change, reducing our greenhouse gas emissions ... more than any other economy since 2005. Instead of punishing US imports, our European allies should work with us to advance a common approach in curbing overseas emissions, particularly those from China, which presently make up about 30 percent of the world’s total."