27. June, 2025

US CBAM, take two

With Europe’s carbon border adjustment mechanism (CBAM) getting attention all over the world, the fact that the last United States Congress (2023-2024) saw several proposals for similar ways to “level the playing field” on trade in emission-intensive goods flew under the radar of carbon market stakeholders. Having published an explanation of those proposals last year, Veyt takes a look at the only one re-introduced in the current 119th Congress (2025-2026) which is unlikely to go anywhere in terms of becoming law. Since it was introduced by two Republican Senators, however, it sets a precedent for potential bipartisan cooperation on a future CBAM-like bill in a legislature more conducive to cross-party cooperation. Based on carbon intensity data for several goods covered by the proposal, it looks like European producers would be relatively unaffected by the legislation as currently structured.

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