The reform of the EU’s carbon market and the free allocation regulation is now voted on. The deal was wrapped in December 2022 and was barely different from what the Commission had proposed nearly two years ago and which we had analysed in September 2021. If the...
Open letter: Free allocation needs to incentivise circularity for the EU to reach net zero To: DG CLIMA - Mr Heiko Kunst Chair of the Expert Group on Climate Change Policy Dear Mr Kunst, We are writing to you on behalf of the European steel scrap recycling...
On 18 April 2023, Sandbag presented to the European Commission’s Expert Group on Climate Change Policy a proposal for reforming the granting of free emission permits to industry under the bloc’s carbon market. Our proposal aims to incentivise the switch to lower...
Sandbag warns that EU carbon market reforms raise ambition but fail to fix structural flaws: free allocation is phased out too slowly, CBAM coverage remains partial, benchmarks still reward polluting processes, and circularity is sidelined-risking inefficiency, distortions, and missed decarbonisation opportunities
This weekend, the European Commission, Parliament, and Council are set to finalise an important reform of the EU’s carbon market in the final round of their “trilogue” (trilogues are informal tripartite meetings on legislative proposals between representatives of the...
A Carbon Border Adjustment Mechanism (CBAM) has been proposed by the European Commission as an alternative to the measures under the EU ETS that currently address the risk of carbon-intensive industries relocating to countries with no carbon pricing (carbon leakage),...
We have strong concerns regarding the legislative texts on the revision of the Emissions Trading Scheme (ETS) and the Carbon Border Adjustment Mechanism (CBAM), presented by the European Commission, Council and Parliament. All three bodies have proposed to extend the...
The second ETS trilogue took place last week on October 11th. Tabled proposals on benchmarks regarding the steel…
In 2021, over 14 million gross tonnes of ships were dismantled, with a third owned by European firms and largely scrapped in South Asia. This practice exports high-quality scrap steel that could otherwise support low-carbon steelmaking in Europe. However, EU carbon market rules currently favour carbon-intensive blast furnaces over cleaner electric arc furnaces (EAFs) by allocating more free emissions allowances to the former. This distorts incentives, discouraging investment in greener technologies. Sandbag calls for a faster phase-out of free allowances and a more comprehensive CBAM to promote domestic recycling and decarbonisation.
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