Fossil fuel exports

The European Union is embarking on an experiment that will expand its climate policies to imports for the first time. It’s called a carbon border adjustment, and it aims to level the playing field for the EU’s domestic producers by taxing energy-intensive imports like steel and cement that are high in greenhouse gas emissions but aren’t already covered by climate policies in their home countries. If the border adjustment works as planned, it could encourage the spread of climate policies around the world. But the EU plan – which members of the European Parliament preliminarily agreed to on Dec. 13, 2022 – as well as most attempts to evaluate the impact of such policies, is missing an important source of cross-border carbon flows: trade in fossil fuels themselves. As energy analysts, we decided to take a closer look at what including fossil fuels would mean. In a newly released paper, we analyzed the impact and found that including fossil fuels in...