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EMISSIONS: UK Carbon Tax Expansion May Hit Industry Costs: BNEF

EMISSIONS
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If the UK included refineries and chemical producers in its upcoming carbon border tax, companies like Ineos could face a five-fold increase in carbon costs, according to Bloomberg’s BNEF.

  • While the UK’s 2027 CBAM targets steel, aluminium, cement, fertiliser, and hydrogen, expanding it could sharply raise costs as free carbon permits phase out.
  • And as free carbon permits are phased out – this could lead to an increase in demand in the UKA emissions market – supporting prices, according to MNI.
  • Additionally, Inoes has pushed for the introduction of a carbon levy on importers to equalise the carbon costs faced by producers.
  • This comes as Britain’s high energy and carbon prices are weighing on the profits of industry and increasingly are blamed for closures – which has led to UK scrapping its last remaining synthetic ethanol plant in Grangemouth.
  • And Petroineos, a JV between PetroChina and petrochemical giant Ineos, is also planning to shut its UK 150,000 b/d oil refinery in Grangemouth in the 2Q2025
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If the UK included refineries and chemical producers in its upcoming carbon border tax, companies like Ineos could face a five-fold increase in carbon costs, according to Bloomberg’s BNEF.

  • While the UK’s 2027 CBAM targets steel, aluminium, cement, fertiliser, and hydrogen, expanding it could sharply raise costs as free carbon permits phase out.
  • And as free carbon permits are phased out – this could lead to an increase in demand in the UKA emissions market – supporting prices, according to MNI.
  • Additionally, Inoes has pushed for the introduction of a carbon levy on importers to equalise the carbon costs faced by producers.
  • This comes as Britain’s high energy and carbon prices are weighing on the profits of industry and increasingly are blamed for closures – which has led to UK scrapping its last remaining synthetic ethanol plant in Grangemouth.
  • And Petroineos, a JV between PetroChina and petrochemical giant Ineos, is also planning to shut its UK 150,000 b/d oil refinery in Grangemouth in the 2Q2025