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Coal power plants outside European borders ‘supply electricity to the EU’

Countries outside European borders are increasingly supplying electricity to the EU while simultaneously avoiding the bloc’s carbon price, according to a new report from climate think tank Sandbag. 

The report: The path of least resistance – how electricity generated from coal is leaking into the EU reveals that countries within the EU Emissions Trading System (ETS) are increasingly importing electricity in this manner, with many more planned links to coal-fired plants outside Europe.

The continuation of this practice will effectively undermine EU emissions cuts and will incentivise further use of coal in neighbouring countries, turning them into ‘offshore carbon havens’, suggests the report. 

Net electricity imports to the EU have risen dramatically – from 3 TWh in 2017 to 21 TWh in 2019. All the imports are from countries that have zero or near-zero carbon pricing, such as Turkey, Morocco, Ukraine and Bosnia and Herzegovina. Imports are likely to rise further as plans exist to increase the interconnectivity between EU and non-EU states by 31% by 2030. 

The key EU countries most exposed to coal power imports are Greece, Finland, Spain, Croatia and Romania, says the report. 

Furthermore, by 2025, Sandbag estimates that up to 57 GW of new coal power is being planned or will be constructed in countries connected to the EU ETS. This includes 34 GW in Turkey, 11 GW in Egypt, 4 GW in Bosnia and Herzegovina and 2 GW in Serbia. 

‘Europe’s carbon price is driving a new wave of coal plant building just beyond its borders,’ said Dr Chris Rosslowe, Electricity Analyst at Sandbag. ‘The solution isn’t too complicated though: a border tax on the carbon in this imported electricity. With this one new policy, we can spread the emissions-cutting influence of the EU beyond its borders, and help neighbouring countries build clean energy faster.’ 

Sandbag’s proposed tax would be a border carbon adjustment on gross electricity imports into the EU ETS region. It says this would defend the integrity of EU climate policy by preventing offshoring of power sector emissions and would also create an incentive for neighbouring states to decarbonise and/or align climate policies, accelerating the spread of carbon pricing.

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