In June 2019 the UK put into law a commitment to end its contribution to global warming by 2050. The first major economy in the world to do so.
The EU is increasing its ambition and many countries are also joining the push for net zero. Carbon pricing is moving centre stage as one of the best mechanisms to coordinate domestic and international action. Frontier was recently commissioned to contribute to a research report by the Zero Carbon Campaign focused on carbon pricing.
The report centres on how the use of carbon pricing can help move the UK towards its net zero target, protect the UK’s competitiveness and support low income households. The report highlights that as well as the government’s net zero target, it will also be necessary to drive economic recovery and ensure public support – which is where a new approach to carbon pricing comes in.
Our analysis focused on the implications of carbon pricing for the competitiveness of the steel sector and what could be done to ensure a level playing field for imports and exports of steel. More specifically, our research found that if the government implemented a carbon charge as well as a Border Carbon Adjustment (BCA) the impact would be:
-An increase in the competitiveness of the UK steel sector
-Improvements in the average competitiveness of UK-Based steel production
-Raising between £270 million and £850 million (depending on the design of the tax) for new investment and related measures.
You can download the full report by clicking the link below.
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