Here’s the trick! Study reveals how aluminium scrap, with a Billion-Euro backdoor, is potent to loosen EU’s Carbon Border for importers
When the European Union unveiled its Carbon Border Adjustment Mechanism (CBAM), the ambition was clear: to build a fortress against carbon leakage, shield domestic industries from unfair competition, and incentivise global decarbonisation. It was heralded as the world’s most sophisticated climate tariff, with a complex, bold, and precise outline.
But as the legislation transitions from theory to implementation, a critical vulnerability has emerged. And it’s not in exotic energy systems or abstract accounting tricks. It’s in something far more mundane, yet deceptively potent — aluminium scrap.
As for the current plan, CBAM creates a multi-billion-euro arbitrage opportunity for foreign aluminium producers. And the loophole is alarmingly simple. Both pre-consumer and post-consumer aluminium scrap are excluded from CBAM’s emissions accounting. That oversight could render the EU’s climate fortress porous, not just at the edges, but at the very core of its aluminium trade policy.
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