41 Amendments of Michal WIEZIK related to 2021/0214(COD)
Amendment 22 #
Proposal for a regulation
Recital 10
Recital 10
(10) Existing mechanisms to address the risk of carbon leakage in sectors or sub- sectors at risk of carbon leakage are the transitional free allocation of EU ETS allowances and financial measures to compensate for indirect emission costs incurred from GHG emission costs passed on in electricity prices respectively laid down in Articles 10a(6) and 10b of Directive 2003/87/EC. However, free allocation under the EU ETS weakens the price signal that the system provides for the installations receiving it compared to full auctioning and thus affects the incentives for investment into further abatement of emissions. Introduction of the CBAM must lead to phase out of these mechanisms to ensure that the price of domestically produced as well as imported products reflects more accurately their carbon content.
Amendment 27 #
Proposal for a regulation
Recital 11
Recital 11
(11) The CBAM seeks to replace these existing mechanisms by addressing the risk of carbon leakage in a different way, namely by ensuring equivalent carbon pricing for imports and domestic products. To ensure a gradual transition from the current system of free allowances to the CBAM, the CBAM should be progressively phased in while free allowances in sectors covered by the CBAM are phased out simultaneously. The combined and transitional application of EU ETS allowances allocated free of charge and of the CBAM should in no case result in more favourable treatment for Union goods compared to goods imported into the customs territory of the Union. Therefore, the compatibility with WTO rules should be provided for by the phase out of free allowances in the EU market ensuring similar treatment of domestic and imported products based on the principle of non-discrimination.
Amendment 30 #
Proposal for a regulation
Recital 12
Recital 12
(12) While the objective of the CBAM is to prevent the risk of carbon leakage, this Regulation would also encourage the use of more GHG emissions-efficient technologiesand regenerative technologies, e.g. in agriculture, by producers from third countries, so that less emissions per unit of output are generated.
Amendment 60 #
Proposal for a regulation
Recital 35 a (new)
Recital 35 a (new)
(35a) Sectors of pulp and paper are excluded from the proposed mechanism partly due to the fact that specific emission costs are relatively low due to no price being put on carbon coming from the respective sector and administrative burden thus might exceed the monetary benefit. Carbon stored in the ecosystems that provide biomass is however an intrinsic element of the climate change mitigation and adaptation. The Commission should by December 2025 assess whether carbon embedded in the short lived harvested wood products, accounted for in the land use, land use change and forestry sector should be covered by this Regulation. Carbon undergoing instantaneous oxidisation in the biomass installations using woody biomass to produce electricity, included in cogeneration, should be included in the scope of this Regulation.
Amendment 63 #
Proposal for a regulation
Recital 37
Recital 37
(37) Import of electricity should be included in the scope of this Regulation, as this sector is responsible for 30 per cent of the total GHG emissions in the Union. The enhanced Union climate ambition would increase the gap in carbon costs between electricity production in the Union and abroad. That increase combined with the progress in connecting the Union electricity grid to that of its neighbours would increase the risk of carbon leakage due to increased imports of electricity, a significant part of which is produced by coal-fired power plants. Given that the coal-to-biomass conversion is one of the envisaged scenarios of the transition and this could have significant consequences for land use sector and depending on the type of biomass use could result in negative carbon savings, carbon embedded in the process of combustion of biomass is newly included in the EU ETS. Respective values of emission intensity of EU energy mix comprising bioenergy plants burning wood, including in form of pellets, are used as default values to determine the reference value for embedded emissions. In case an authorised declarant chooses to determine the embedded emissions based on the actual emissions, the carbon embedded in the process of combustion of woody biomass should be included.
Amendment 108 #
Proposal for a regulation
Article 2 – paragraph 7 – point e a (new)
Article 2 – paragraph 7 – point e a (new)
(ea) the third country or territory has committed to halt and reverse forest loss and land degradation by 2030 and has accordingly formally formulated and communicated strategy aligned with that objective, and has implemented that obligation in its domestic legislation;
Amendment 109 #
Proposal for a regulation
Article 2 – paragraph 7 – point f
Article 2 – paragraph 7 – point f
(f) the third country or territory has put in place an effective systems to prevent indirect import of electricity in the Union from other third countries not meeting the requirements set out in points (a) to (ea).
Amendment 149 #
Proposal for a regulation
Article 30 – paragraph 1
Article 30 – paragraph 1
1. The Commission shall collect the information necessary with a view to extending the scope of this Regulation to indirect emissions and goods other than those listed in Annex I, and develop methods of calculating embedded emissions based on environmental footprint methods. As part of this process, the Commission shall assess whether carbon embedded in the short lived harvested wood products, accounted for in the land use, land use change and forestry sector, should be covered by this Regulation.
Amendment 168 #
Proposal for a regulation
Recital 10
Recital 10
(10) Existing mechanisms to address the risk of carbon leakage in sectors or sub- sectors at risk of carbon leakage are the transitional free allocation of EU ETS allowances and financial measures to compensate for indirect emission costs incurred from GHG emission costs passed on in electricity prices respectively laid down in Articles 10a(6) and 10b of Directive 2003/87/EC. However, free allocation under the EU ETS and compensations for the electricity costs weakens the price signal that the system provides for the installations receiving it compared to full auctioning and thus affects the incentives for investment into further abatement of emissions. Introduction of the CBAM must lead to phase-out of these mechanisms to ensure that the price of domestically produced as well as imported products reflects more accurately their carbon content.
Amendment 214 #
Proposal for a regulation
Recital 11
Recital 11
(11) The CBAM seeks to replace these existing mechanisms by addressing the risk of carbon leakage in a different way, namely by ensuring equivalent carbon pricing for imports and domestic products. To ensure a gradual transition from the current system of free allowances to the CBAM, the CBAM should be progressively phased in while all free allowances in sectors covered by the CBAM are phased out. The combined and transitional application of EU ETS allowances allocated free of charge and of the CBAM should in no case result in more favourable treatment for Union goods compared to goods imported into the customs territory of the Union.
Amendment 223 #
Proposal for a regulation
Recital 11 a (new)
Recital 11 a (new)
(11a) Installations under the EUETS facing a rising carbon price need long- term visibility, predictability and legal certainty to make their investment decisions. A clear pathway for the phase in of the remaining sectors and subsectors at risk of carbon leakage should therefore be established. This will strengthen the new legal framework to fight carbon leakage, provide the necessary time to ensure a smooth implementation of the CBAM and allow installations and companies to make the necessary investments in the decarbonisation of industrial processes in a stable and predictable legal context.
Amendment 225 #
Proposal for a regulation
Recital 11 a (new)
Recital 11 a (new)
(11a) The transition from the current system of free allowances to the CBAM is needed to incentivise the investment into further abatement of emissions globally in line with the goals of the Paris Agreement, the European Green Deal and Regulation (EU) 2021/1119 while ensuring transparency and predictability of the system and avoiding excessive protection of Union installations contrary to WTO rules. Such transition should be completed gradually by 31 December 2028.
Amendment 307 #
Proposal for a regulation
Recital 17
Recital 17
(17) The GHG emissions to be regulated by the CBAM should correspond to those GHG emissions covered by Annex I to the EU ETS in Directive 2003/87/EC, namely carbon dioxide (‘CO2’) as well as, where relevant, nitrous oxide (‘N2O’) and perfluorocarbons (‘PFCs’). The CBAM should initially apply to direct emissions of those GHG from the production of goods up to the time of import into the customs territory of the Union, and after the end of a transition period and upon further assessment, as well to indirect emissions, mirroring the scope of the EU ETS.
Amendment 333 #
Proposal for a regulation
Recital 22 a (new)
Recital 22 a (new)
(22a) The free allocation no longer provided to the CBAM sectors based on this calculation (CBAM demand) must be auctioned and the revenues will accrue to the Innovation Fund rebranded as a Net- Zero Fund, so as to support inter alia innovation in low carbon technologies, and in upscaling relevant technologies in a way that contributes to mitigating climate change consistently with the objectives set out by Regulation (EU)2021/1119. Special attention should be given to projects in CBAM sectors. To respect the proportion of the free allocation available for the non-CBAM sectors, the final amount to deduct from the free allocation and to be auctioned should be calculated based on the proportion that the CBAM demand represents in respect of the free allocation needs of all sectors receiving free allocation.
Amendment 374 #
Proposal for a regulation
Recital 30
Recital 30
(30) The use of the first criterion allows listing the following industrial sector in terms of cumulated emissions: iron and steel, refineries, cement, pulp and paper, organic basic chemicals, and fertilisers.
Amendment 390 #
Proposal for a regulation
Recital 34
Recital 34
(34) However, aluminium products should be included in the CBAM as they are highly exposed to carbon leakage. Moreover, in several industrial applications they are in direct competition with steel products because of characteristics closely resembling those of steel products. Inclusion of aluminium is also relevant as the scope of the CBAM may be extended to cover alsoalso counts for indirect emissions in the future.
Amendment 393 #
Proposal for a regulation
Recital 35 a (new)
Recital 35 a (new)
(35a) Sectors of pulp and paper should not be excluded from the mechanism. Carbon stored in the ecosystems that provide biomass is an intrinsic element of the climate change mitigation and adaptation. The Commission should by the end of transition period assess whether carbon embedded in the short lived harvested wood products, accounted for in the land use, land use change and forestry sector should be covered by this Regulation. Carbon undergoing instantaneous oxidisation in the biomass installations using woody biomass to produce electricity, included in cogeneration, should be included in the scope of this Regulation.
Amendment 403 #
Proposal for a regulation
Recital 37
Recital 37
(37) Import of electricity should be included in the scope of this Regulation, as this sector is responsible for 30 per cent of the total GHG emissions in the Union. The enhanced Union climate ambition would increase the gap in carbon costs between electricity production in the Union and abroad. That increase combined with the progress in connecting the Union electricity grid to that of its neighbours would increase the risk of carbon leakage due to increased imports of electricity, a significant part of which is produced by coal-fired power plants. Given that the coal-to-biomass conversion is one of the envisaged scenarios of the transition, this could have significant consequences for land use sector. Depending on the type of biomass use the coal-to-biomass conversion could result in negative carbon savings. The carbon embedded in the process of combustion of biomass is newly included in the EU ETS. Respective values of emission intensity of the Union energy mix comprising bioenergy plants burning wood, including in form of pellets, are used as default values to determine the reference value for embedded emissions. When the authorised declarant is charged on the basis of actual emissions, the carbon embedded in the process of combustion of woody biomass should be included.
Amendment 479 #
Proposal for a regulation
Recital 52
Recital 52
(52) The Commission should evaluate the application of this Regulation before the end of the transitional period and report to the European Parliament and the Council. The report of the Commission should in particular focus on possibilities to enhance climate actions towards the objective of a climate neutral Union by 2050. The Commission should, as part of that evaluation, initiate collection of information necessary to possibly extend the scope to indirect emissions, as well as to other goods and services at risk of carbon leakage, and to develop methods of calculating embedded emissions based on the environmental footprint methods47 . __________________ 47Commission Recommendation 2013/179/EU of 9 April 2013 on the use of common methods to measure and communicate the life cycle environmental performance of products and organisations (OJ L 124, 4.5.2013, p. 1).
Amendment 508 #
Proposal for a regulation
Recital 54 a (new)
Recital 54 a (new)
(54a) The Commission should actively pursue the establishment of an international “Carbon club” for ensuring continuous exchange in good faith with the Union’s trade partners. This should be an open non-exclusive international forum, which could be located under an appropriate multilateral organisation such as the WTO or the relevant and open body of the OECD for instance. Its objective should be to allow for the comparison and coordination of carbon pricing measures as well as non-carbon pricing measures with an impact on emission reduction. The Carbon club should also support the comparability of climate measures by ensuring the quality of climate monitoring, reporting and verification among its members. Membership of the club should be informal, open and on a voluntary basis for countries aiming at high climate ambition in line with the Paris Agreement. Given that the CBAM is a first-of-a-kind measure, which is meant to be a cooperative tool designed to fight carbon leakage, such a Carbon club will provide the means for engagement and transparency between the and its trade partners.
Amendment 516 #
Proposal for a regulation
Recital 55 a (new)
Recital 55 a (new)
(55a) In support of least developed countries' efforts towards the decarbonisation of their manufacturing industries, technical assistance, technology transfer and extensive capacity building should be provided as well as financial support. To ease the transition, a gradual phasing in of the CBAM could be considered for existing production capacities in least developed countries'.
Amendment 529 #
Proposal for a regulation
Recital 61 a (new)
Recital 61 a (new)
(61a) The revenues generated should be attributed to the Union budget as an own resource in accordance with the procedures set out in Article 311 TFEU, pursuant to Annex 2 of the Interinstitutional Agreement of 16 December 20201a and as proposed by the Commission on 22 December 2021 in its legislative proposal to amend the Own Resources Decision1b. The CBAM-based own resource would thus be part of a basket of own resources whose total proceeds should be sufficient to cover the level of overall expected expenditure for the repayment costs of the principal and interests of the borrowing incurred under the Next Generation EU instrument, while respecting the principle of universality. Together with the ETS-based own resource, these two green own resources should also link the Union budget with the Union’s policy priorities, and thus add value. They should contribute to the climate mainstreaming objectives and the resilience of the Union budget as a tool for investments and guarantees. __________________ 1aInterinstitutional Agreement of 16 December 2020 between the European Parliament, the Council of the European Union and the European Commission on budgetary discipline, on cooperation in budgetary matters and on sound financial management, as well as on new own resources, including a roadmap for the introduction of new own resources (OJ L 433I, 22.12.2020, p. 28.). 1b COM(2021)0570 final.
Amendment 575 #
Proposal for a regulation
Article 2 – paragraph 1
Article 2 – paragraph 1
1. This Regulation applies to goods as listed in Annex I, originating in a third country, when those goods, or processed products from those goods as resulting from the inward processing procedure referred to in Article 256 of Regulation (EU) No 952/2013 of the European Parliament and of the Council53 , are imported into the customs territory of the Union. This Regulation also applies to downstream products that include goods listed in Annex I above a minimum threshold, subject to paragraph 2a of this Article, __________________ 53Regulation (EU) No 952/2013 of the European Parliament and of the Council of 9 October 2013 laying down the Union Customs Code (OJ L 269, 10.10.2013, p. 1).
Amendment 577 #
Proposal for a regulation
Article 2 – paragraph 1 a (new)
Article 2 – paragraph 1 a (new)
1a. By 30 June 2025, the Commission shall adopt a delegated act in accordance with Article 28 supplementing this Regulation by amending Annex I to establish a timeline for the gradual inclusion of all goods at risk of carbon leakage for which the production is covered in the EU ETS, starting from 1 January 2026 and ending on 1 January 2030 at the latest, giving priority to the sectors most exposed to carbon leakage.
Amendment 581 #
Proposal for a regulation
Article 2 – paragraph 2 a (new)
Article 2 – paragraph 2 a (new)
2a. The Commission shall by 31 July 2024 adopt a delegated act in accordance with Article 28 to establish a methodology for identifying downstream products covered by this Regulation, including establishing a minimum threshold for the amount of the concerned goods in the product.
Amendment 611 #
Proposal for a regulation
Article 2 – paragraph 7 – point e a (new)
Article 2 – paragraph 7 – point e a (new)
(ea) the third country or territory has committed to halt and reverse forest loss and land degradation by 2030 and has accordingly formally formulated and communicated strategy aligned with that objective, and has implemented that obligation in its domestic legislation;
Amendment 612 #
Proposal for a regulation
Article 2 – paragraph 7 – point f
Article 2 – paragraph 7 – point f
(f) the third country or territory has put in place an effective systems to prevent indirect import of electricity in the Union from other third countries not meeting the requirements set out in points (a) to (ea).
Amendment 641 #
Proposal for a regulation
Article 3 – paragraph 1 – point 11
Article 3 – paragraph 1 – point 11
(11) ‘competentCBAM authority’ means the authority, designated by each Member State appointed by the Commission in accordance with Article 11 of this Regulation;
Amendment 654 #
Proposal for a regulation
Article 3 – paragraph 1 – point 16
Article 3 – paragraph 1 – point 16
(16) ‘embedded emissions’ mean direct and indirect emissions released during the production of goods, calculated pursuant to the methods set out in Annex III;
Amendment 672 #
Proposal for a regulation
Article 3 – paragraph 1 – point 28 a (new)
Article 3 – paragraph 1 – point 28 a (new)
(28a) ‘downstream products' means products manufactured by using goods listed in Annex I .
Amendment 676 #
Proposal for a regulation
Article 4 – paragraph 1
Article 4 – paragraph 1
Goods shall only be imported into the customs territory of the Union by a declarant that is authorised by the competentCBAM authority in accordance with Article 17 (‘authorised declarant’). Throughout the Regulation, the term ‘competent authority’ is replaced by ‘CBAM authority’ and any necessary grammatical changes are made.
Amendment 729 #
Proposal for a regulation
Article 8 – paragraph 1 a (new)
Article 8 – paragraph 1 a (new)
1a. The CBAM report submitted by companies shall be verified according to this Article.
Amendment 754 #
Proposal for a regulation
Article 9 – paragraph 2
Article 9 – paragraph 2
2. The authorised declarants shall keep records of the documentation, certified by an independent person, verifier accredited pursuant to Article 18 of this Regulation. The accredited verifier shall be required to demonstrate that the declared embedded emissions were subject to a carbon price in the country of origin of the goods and keep evidence of the proof of the actual payment for that carbon price which should not have been subject to an export rebate or any other form of compensation on exportation.
Amendment 835 #
Proposal for a regulation
Article 14 – paragraph 3
Article 14 – paragraph 3
3. The information in the database referred to in paragraph 2 shall be confidentialmade available to the public, unless it is deemed as business confidential. Information equivalent to the one made publicly available for EU producers under the EU ETS central database shall be made public.
Amendment 1119 #
Proposal for a regulation
Article 30 – paragraph 1
Article 30 – paragraph 1
1. The Commission shall collect the information necessary with a view to extending the scope of this Regulation to indirect emissions and goods other than those listed in Annex I, and develop methods of calculating embedded emissions based on environmental footprint methods.
Amendment 1156 #
Proposal for a regulation
Article 30 – paragraph 2 a (new)
Article 30 – paragraph 2 a (new)
2a. By 1January 2028, the Commission shall present a report to the European Parliament and the Council on the application of this Regulation, based on the first years of effective application from the Regulation. That report shall highlight, in particular the impact of CBAM on CO2 cost equalisation and on carbon leakage mitigation and to what extent forms of circumventions are avoided
Amendment 1160 #
Proposal for a regulation
Article 30 – paragraph 3
Article 30 – paragraph 3
3. The report by the Commission shall, if appropriate, be accompanied by a legislative proposal to extend the scope of this Regulation as set out in paragraphs 1 and 2 and including the measure to calculate embedded emissions based on the environmental footprint methods.
Amendment 1203 #
Proposal for a regulation
Article 31 – paragraph 1 a (new)
Article 31 – paragraph 1 a (new)
1a. All free allocations allocated in accordance with Article 10a of Directive 2003/87/EC shall be phased out by the date of application of the CBAM, as provided in Article 36(3) of this Regulation and no later than by 31 December 2028.
Amendment 1207 #
Proposal for a regulation
Article 31 – paragraph 2 a (new)
Article 31 – paragraph 2 a (new)
2a. The Commission shall adopt delegated acts in accordance with Article 28 by 31 December 2025 to define criteria allowing an installation producing goods covered by this Regulation to apply for continued appropriate protection against the risk of carbon leakage in relation to costs deriving from EU ETS allowances linked to exports of goods to third countries. The criteria shall consider the carbon leakage risks, overall environmental effects and decarbonisation efforts of these installations and rely on the existing benchmarks and follow the principle of Directive 2003/87/EC to identify the most carbon-efficient installations. The criteria should take into account the emissions embedded in a similar product and carbon prices in the third country pursuant to Articles 7, 8 and 9 of this Regulation. This protection against the risk of carbon leakage for exports should only be used to enhance decarbonisation efforts. The Commission shall ensure that the delegated act is fully compliant with WTO rules.
Amendment 1253 #
Proposal for a regulation
Annex I – subheading 5 a (new)
Annex I – subheading 5 a (new)
Pulp and paper
Amendment 1265 #
Proposal for a regulation
Annex III – point 2 – paragraph 1 – introductory part
Annex III – point 2 – paragraph 1 – introductory part
For determining the specific actual embedded emissions of simple goods produced in a given installation, only direct emissions and indirect emissions shall be accounted for. For this purpose, the following equation is to be applied: