Elizabeth de Jong, chief executive, UKPIA

UKPIA CEO Elizabeth de Jong

UKPIA has welcomed a report from a cross-party and cross-industry group aiming to stop investment leaking to countries with lower environmental standards.

The report, Fixing the Carbon Leak, is from the Commission for Carbon Competitiveness, and advocates setting up a Carbon Border Adjustment Mechanism (CBAM) to ensure importers face equivalent costs for carbon emissions to UK manufacturers.

UKPIA CEO Elizabeth de Jong said: “We welcome the commission’s recommendations on ambitious new carbon policies to create a level playing field with importers from countries with less stringent environmental standards. Without these changes, investment in refineries vital to achieve the UK’s net zero targets will go overseas.

“We fully support the recommendations around the introduction of a well-designed Carbon Border Adjustment Mechanism (CBAM) as a vital step to ensure importers face equivalent costs for carbon emissions as UK manufacturers.

“Government also needs to introduce a package of financial support for decarbonisation projects that matches those offered to projects in the US, EU and other competitor countries. If not, we will see more imports of higher carbon fuels, which will increase overall global emissions. Failure to act would also lead to the loss of UK jobs and risk security of supply.”