The mechanism will put a carbon price on imported goods from a number of sectors
The UK government has confirmed that the country’s cross-border carbon adjustment mechanism (CBAM) will be launched in January 2027. This is stated in a consultation document published on October 30.
As noted, the start date of the mechanism will balance the need for prompt action on carbon leakage with the need to give businesses time to prepare for the introduction of a new and complex measure.
The mechanism will set a price on carbon for goods imported into the UK from a number of sectors (aluminum, ferrous metals, cement, fertilizers and hydrogen).
“This will ensure that the UK’s decarbonization efforts lead to genuine reductions in global emissions, rather than simply displacing carbon emissions abroad,” the document says.
The UK CBAM will apply only to specific imported goods, defined by its scope at the product level and identified by a code.
Glass and ceramics products will not be included in the scope of the UK’s cross-border carbon adjustment mechanism from 2027, as previously proposed, to give the government and industry time to address implementation issues that arose during the consultation process.
It is emphasized that the mechanism will apply to direct, indirect emissions and certain precursor emissions contained in imported CBAM products.
The document says that during the consultation period (which began in March this year), government officials held more than 20 domestic and 30 international meetings and events, including industry roundtables. The government will continue to engage with stakeholders as it develops the policy ahead of implementation.
In October 2024, experts expressed the opinion that the UK should avoid the application of the European CBAM to it. This mechanism could be an incentive to link the UK ETS to the relevant EU emissions trading system.
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