Webinar | Carbon Pricing, the WTO and CBAM after COP 26: Can We Connect the Dots?

Trade and Sustainability Hub 2021 Session 17 (Recorded December 2, 2021)

As governments plan for climate action, border carbon adjustments are no longer hypothetical. Addressing climate change almost certainly means requiring energy-intensive, trade-exposed sectors such as steel, cement, aluminum, and chemicals to bear a measure of the cost of their carbon emissions. The inevitable partner to substantial prices on carbon in some jurisdictions is an attempt to protect against leakage—that is, the increase of emissions abroad in response to strong domestic climate policies. The European Commission has proposed implementing a carbon border adjustment mechanism by 2023, Canada has launched formal consultations on the shape of its regime, and the United States and the United Kingdom have signalled a similar interest. However, these measures are likely to lead to direct impacts on the exports of trading partners, most immediately those that export in the sectors covered by border carbon adjustments. The measures are also going to involve significant upfront and ongoing costs for affected businesses.

This session reviews the links between the UNFCCC and WTO policy processes and then explores the implications of trade-related measures linked to carbon pricing—border carbon adjustments, in particular.

Speakers:
• Nathalie Bernasconi, International Institute for Sustainable Development (IISD)
• Aaron Cosbey, International Institute for Sustainable Development (IISD)
• Hannes Schloemann, WTI Advisors and Climate Capital SARL
• Alice Tipping, International Institute for Sustainable Development (IISD)
• Douglas Prentice, Climate Capital
• Xiankun Lu, Friends of Multilateralism Group (FMG) Geneva
• Aarti Krishnan, University of Manchester

Session organizers: International Institute for Sustainable Development (IISD), WTI Advisors, Climate Capital