Chris Bowen announces new tariff for imported steel and cement to help decarbonization
- Imported steel and cement could be subject to customs duty
- This tax is so that producers who go green are not disadvantaged
- Government wants Australian growers to be on a level playing field
Imported steel and cement could be subject to a tariff to ensure that Australian producers seeking to reduce carbon emissions are not disadvantaged.
Climate Change Minister Chris Bowen told an Australian Business Economist Forum in Sydney on Tuesday that policies were needed to ensure a level playing field for Australian businesses.
“The task of decarbonization is more acute for large industrial facilities, often in sectors that are hard to scale down and subject to competition in international markets,” Bowen said.
He said that now that Australia had put in place a safeguard mechanism to improve incentives and confidence for facilities to invest in decarbonising their operations, it was time to consider how best to prevent “international risks carbon leakage”.
But at the same time, any policy change had to protect Australia’s reputation as a reliable and secure trading partner.
Imported steel and cement could face a tariff to ensure a level playing field for Australian producers (stock image)
“We know the production potential of moving from countries with more ambitious emission reduction policies to those with weaker emission reduction policies that can lead to increased global emissions,” Bowen said.
“Carbon leakage undermines national and international climate action and has long been a key consideration in shaping climate policy around the world.”
The European Union is developing a “Carbon Border Adjustment Mechanism”, which means that from 2026 major importers in the EU will have to buy certificates equivalent to the carbon price of their trading system resignation.
The EU regime applies to imports in five emissions-intensive sectors deemed most at risk of carbon leakage: cement, iron and steel, aluminum, fertilizers and electricity.
Mr Bowen said his department would work with academics on a review to assess the risks of carbon leakage, develop policy options and examine the feasibility of an Australian carbon border adjustment mechanism, particularly with regard to steel and cement.
Opposition climate spokesman Ted O’Brien said the minister’s announcement showed the Labor Party’s safeguard mechanism was making Australian industry uncompetitive in the global market.
“By forcing the price of cheaper imported goods, Labor will continue to put upward pressure on inflation and interest rates and it will be everyday Australians who will pay the price,” he said. said Mr. O’Brien.
“You can’t fix one bad policy with another.”
Climate Change Minister Chris Bowen (pictured) wants Australian producers seeking to cut carbon emissions not to be disadvantaged
Ella Factor, climate campaigner from the Australian Conservation Foundation, said it was important for the government to look at international examples of cross-border adjustment mechanisms.
“ACF would like to see a whole-of-government export strategy to ensure a smooth transition from our overreliance on fossil fuel exports to clean exports,” she told AAP.
“A clean export strategy would build on domestic renewable energy and decarbonisation strategies, but go further to unlock Australia’s massive potential to thrive in a decarbonising world.”