In the News

WASHINGTON, July 19 - Two Democratic lawmakers on Monday introduced legislation establishing a carbon tariff on certain imports like steel as a means to fight climate change, a week after Europe launched the world’s first carbon border tax.

Delaware Senator Chris Coons and California Congressman Scott Peters said the bill would level the competitive playing field for domestic manufacturers by imposing a fee on carbon-intensive products from countries that lack adequate emissions controls.

"International cooperation will be critical to reaching net-zero emissions,” said Coons. “We have an historic opportunity to demonstrate that climate policy goes hand in hand with providing economic opportunities as U.S. innovators develop and scale clean energy technologies."

Senate Democrats have said they want to include a carbon border tariff as part of a $3.5 trillion budget reconciliation bill, which could be passed with a simple majority vote.

A carbon border adjustment tariff is a policy tool that aims to encourage cleaner forms of industrial production by making carbon intensive goods from abroad less economical.

The Democrats' bill would target products like steel, natural gas, petroleum, and coal.

The EU last week set a carbon tariff as part of its goal to slash greenhouse gas emissions by 55% by 2030 from 1990 levels. It said the levy will be compatible with World Trade Organization rules and require importers of certain goods to buy emissions offsets.

But it has raised concerns in several countries that it will cool international trade or trigger messy disputes.

U.S. Special Envoy for Climate Change, John Kerry, for example, expressed concern in March about an EU border tariff, saying it could have "serious implications for economies, and for relationships, and trade."

Revenue from the Coons-Peters bill would fund climate resilience programs and emissions reductions technologies, the lawmakers said.