EU agrees hydrogen carbon border tariffs

Carbon border adjustment mechanism will apply to imported hydrogen as well as other industrial products from 2023

Non-EU companies importing carbon-intensive hydrogen and ammonia into the EU will have to pay a tax on the fuels later this decade, following a deal by EU lawmakers on the proposed Carbon Border Adjustment Mechanism (CBAM). A test phase will begin in 2023, during which importers will be required only to measure and report the emissions produced in the manufacture of hydrogen imported into the EU. Later in the decade, they will be obliged to purchase ‘CBAM certificates’ to pay for the difference between the carbon price in the country of production and the price of carbon allowances under the EU emissions trading system (ETS). “The EU cannot afford to create additional obstacles in reac