CBAM implications for Kosovo and its electricity sector
The Carbon Border Adjustment Mechanism (CBAM) is a climate policy by the European Union (EU). It aims to prevent carbon leakage – when production moves to countries with weaker climate rules – and to ensure fair competition between EU and non-EU producers. In October 2023, CBAM entered into force in a transitional phase, requiring EU importers to report the embedded emissions in certain goods (iron and steel, aluminium, cement, fertilisers, hydrogen, and electricity), without paying charges yet.