The country supports expanding the scope of the European mechanism and eliminating loopholes

The Norwegian Ministry of Climate and Environment has submitted an official response to the European Commission’s first consultation on the next phase of implementing the European Cross-Border Carbon Adjustment Mechanism. The country expressed its position at the end of August, noted CBAM expert David Cruz.

Norway supported the expansion of the scope of CBAM – the inclusion of more processed products, especially those whose prices are linked to the mechanism’s main commodities. However, the country acknowledges that it is difficult to determine where the line should be drawn.

The Norwegian ministry also points to the issue of closing loopholes. According to the document, some circumvention opportunities can be addressed by expanding the scope. An example is the inclusion of technological scrap in the aluminum sector and the addition of possible substitutes in general. Emissions reporting rules and standard coefficients can also play a role in preventing circumvention.

The importance of harmonized emission coefficients for imported electricity and clear incentives for third countries to decarbonize their energy networks is also emphasized.

Norway plans to introduce its own cross-border carbon adjustment mechanism from 2027. CBAM is designed to ensure fair pricing for greenhouse gas emissions in industrial production. This means that imported products from countries with less stringent environmental standards will also be subject to a carbon tax, just like goods produced within the EU and Norway. In this way, the Norwegian government seeks to create a level playing field for local producers and avoid “carbon leakage.”