KEY MESSAGES
- We welcome the opportunity to contribute with feedback on the rules and methodologies applicable to electricity under the Carbon Border Adjustment Mechanism (CBAM).
- As noted in our position paper, “A Carbon Border Adjustment Mechanism fit for the power sector,” Eurelectric supports CBAM as a method to address the impact of carbon leakage. In order to achieve this objective, we recommend a series of adjustments in its reporting requirements.
- We call for changes to the methodology for the establishment of default values. To achieve a more accurate measure for the CO2 content of imports, formulas should ideally take into account the hourly mix (at the time of consumption). It should also consider if production is being increased for export to the EU and if so, which technologies are being utilised.
- We encourage revising the conditions for reporting actual emissions to ensure the feasibility of compliance. Specific aspects requiring amendment include provisions surrounding power purchase agreement (PPA), direction connections, physical connection to the Union transmission system, physical network congestion, nomination of interconnector capacity within the same hour as electricity generation, and verification of compliance.
- Considering the diverse array of power companies, we appreciate the flexibility in permitted methods for reporting and declaring purchases of electricity. We would like to see a continuation of this flexibility, enabling companies to choose whether they delegate the submission of customs declaration or prepare it internally. Ensuring access to information, in particular from non-EU TSOs needs to be ensured.
- Delayed publication of guidelines and implementing and delegating acts creates regulatory uncertainty and reduces companies’ adjustment times. We call for a more expedited timetable for the release of primary and secondary legislation, as well as for amendments to the current reporting processes.
- We reiterate support for linking the EU’s ETS with similar emissions trading systems in neighbouring countries to reduce trading complexity and costs. We specifically call for the ex-ante mutual disapplication of CBAM to the United Kingdom during the ETS linking negotiations.