Sandbag

The Circular Economy Act represents an opportunity to move beyond the EUs current fragmented waste policy and embed circularity as a core pillar of Europes industrial and climate strategy, creating the harmonised, predictable conditions needed for circular business models.

Labelling schemes are a source of debate with the proponents of each scheme claiming that the schemes either favour the ore-based or the scrap-based route of production. Without delving into the details of relative advantages of each labelling scheme, we recommend 4 principles and key criteria that should be included in any steel-related labelling scheme used to determine the incentives and support from EU and…

- Free allocation phaseout as a means of simplification - Aviation: put a seat belt on EUA supply - Free allocation: switch from process to products - Link indirect cost compensation to carbon-free electricity only - Reform the Innovation Fund to better assess the carbon footprint of electricity use, reserve grants to technology risk, and reserve scale-up subsidies to poorly capitalised sectors - Market stability…

The Sustainable Products Initiative (SPI) offers the possibility to introduce effective, enforceable and holistic sustainability requirements for products in the EU. It is relevant for a wide variety of products, but particularly for emissions-intensive commodity products.

Feedback to proposal for a Carbon Border Adjustment Mechanism November 2021 Sandbag welcomes the opportunity to provide feedback on the Fit-For-55 Proposal for establishing a Carbon Border Adjustment Mechanism. We are supportive of a carbon border adjustment mechanism (CBAM), as an urgent alternative to the free allocation of emission allowances under the EU’s Emissions Trading System.

Opening of the attached position paper · the full paper is on the Commission’s record (source link above)

Sandbag welcomes the opportunity to contribute to the public consultation on the European Commissions proposed revision of the benchmark values of free allocation of emission allowances (2026-2030). This response to the Commissions public consultation outlines a sector-by-sector analysis of the Commissions proposal.

Sandbag welcomes the opportunity to provide feedback on the update of the EU ETS under the FF55 package. Our analyses show that the proposed changes are not enough to guarantee that emissions will stay below the cap and that they could exceed it by 45% in 2030.

Sandbags recommendations: - For steel and aluminium, address scrap-related circumvention by either: Attributing emissions to both pre- and post-consumer scrap, and including scrap as a CBAM-covered input and applying country-level default values, or Using systematic default values - For cement: Apply systematic default values, to prevent resource reallocation without real emissions reductions - Improve indirect…

Sandbag welcomes the opportunity to comment on the Roadmap for the revision of the CPR and emphasises the role which the revised regulation should play in the achievement of the goals of the European Green Deal. The scope of the CPR must therefore be expanded to include the setting of environmental standards for construction projects.

We consider the European Commissions proposed 2040 target to be insufficient to set the EU on a clear path to climate neutrality and ensure climate action takes place with the urgency that is required. The clear recommendation from the European Scientific Advisory Board on Climate Change (ESABCC) for a 90-95% domestic emissions reduction target must be respected and enacted without further delay.

Sandbag welcomes the opportunity to contribute to the public consultation on the European Commissions proposed implementing regulation (IR), under the CBAM regulation, on the carbon price paid in third countries.

Article 9 of the CBAM Regulation stipulates that CBAM declarants may claim a reduction in the number of CBAM certificates to be surrendered in order to take into account the carbon price paid in the country of origin. The reduction may be claimed only if the carbon price has been effectively paid in the country of origin.

Our recommendations: - For steel and aluminium, Address scrap-related circumvention by either: o Attributing emissions to both pre- and post-consumer scrap, or o Using systematic default values - For cement, Apply systematic default values, to prevent resource reallocation without real emissions reductions - Improve indirect emissions accounting Either replace plant-level electricity emissions reporting with a…

We agree with the European Commissions general diagnosis that increasing the share of electricity in overall energy consumption is necessary to achieve deep decarbonisation. However, it is not sufficient. If overall energy use increases, or if electricity generation does not decarbonise rapidly, then electrification may fail its decarbonisation role.

The proposed approach using CBAM benchmarks is surprisingly complex. A different approach (which we had assumed as the obvious solution) would consist of simply mirroring the EU ETS. In the ETS, there is no such thing as a steel benchmark, so the allowances given for the production of steel are dispatched between individual process.

Sandbag welcomes the opportunity to give feedback on the Inception Impact Assessment on updating the EU ETS rules for aviation. In the context of the European Green Deal and the enhanced ambition for 2030, changes to the EU ETS for aviation should not result in a step backwards in terms of tackling CO2 emissions, but a step forward.

We welcome immediate action to reduce Europe’s dependency on Russian fossil fuels in the face of its aggression against Ukraine. However, the European Commission’s proposal reflects the impossibility of meeting this objective while keeping conflicting incentives in force.