Industrial electricity price + CBAM + Hydrogen • Europe.Table

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Dear reader,

Robert Habeck is on the road again as energy ambassador. This week, he is going to Israel, the Palestinian territories, and Jordan. One key topic is set to be renewable energies, but once again, it is also about the supply of natural gas. Israel has a deposit that is easy to explore. However, to be able to supply the raw material to Europe in the foreseeable future, the country would have to cooperate with neighboring states.

Meanwhile in Berlin, Habeck’s officials have recently already been sounding out the feasibility of a far-reaching proposal behind the scenes – a guaranteed industrial electricity price. Over the weekend, the ministry published the call for tenders for a detailed expert opinion. I’ve written about which industrial sectors are to be involved in our News section.

Important votes on the Fit for 55 package are coming up in the EU Parliament this week, including the Carbon Border Adjustment Mechanism. Our digital and climate experts Falk Steiner and Lukas Scheid analyze how the rules for the CBAM could be aligned with Europe’s data policy.

Climate policy will also be one of the most important work areas for the new Chief Executive of the BDI. Tanja Gönner is to succeed Joachim Lang in the summer. Read our Profile of the former Minister for Social Affairs and the Environment in Baden-Württemberg.

Your
Manuel Berkel

Feature

Europe’s data policy: model for CBAM?

The planned Carbon Border Adjustment Mechanism (CBAM) is intended to ensure that non-European suppliers are subject to comparable rules on CO2 emissions as local producers. So far, it is unclear how the instrument can be designed to ensure that companies from other countries also comply with high climate protection standards. The EU has already solved a similar problem in digital policy.

The fact that the European Union can introduce and establish global standards can be considered proven. The best example of this is the General Data Protection Regulation (GDPR): Anyone who wants to process personal data in EU countries is subject to it anyway. Anyone who wants to do this from outside and process data in a third country is also bound by these rules. This is because it is not the country of origin principle that applies, but the so-called market location principle.

Companies, regardless of where they are headquartered, must comply with the requirements of the GDPR. The penalties for providers who violate it can basically run into the billions. The supervisory authorities in the member states can impose the fines; they must check compliance with the rules regardless of political guidelines.

In the case of the CBAM, it is not penalties that are intended to encourage companies to reduce CO2 emissions, but a customs duty. This is levied as soon as a product is imported into the EU for sale. Although this duty is also intended to bring money into the EU’s coffers, ideally the CBAM would have another effect: Companies want to avoid the costs of carbon border adjustment in the enormously important EU internal market, so they could make their production climate-neutral, according to the idea. The CBAM is thus intended to act as an incentive for climate-friendly production beyond European borders – in much the same way that the GDPR has ensured fairer data policies internationally.

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