As global efforts to combat climate change intensify, policy decisions on carbon emissions are more important than ever. One area that is gaining attention is the taxation of biofuel CO2 emissions – a vital topic for countries like Ukraine seeking to remain competitive in a low-carbon economy.
EU regulation: a case for sustainability
Under current European Union rules, CO2 emissions from biomass combustion are not subject to carbon taxes if the fuel meets sustainability criteria. This regulatory stance encourages the use of renewable energy sources while ensuring the economic viability of industries during the transition period.
CBAM and Ukraine’s Industrial Future
Ukraine is preparing to implement the Carbon Border Adjustment Mechanism (CBAM), a carbon pricing instrument applicable to imports to the EU. Once fully implemented, the CBAM could have a significant impact on Ukrainian exports, especially if local industries are burdened by domestic carbon taxes that do not comply with EU standards.
To remain competitive and environmentally friendly, Ukraine should consider tax exemptions for biomass-related CO2 emissions, regardless of the percentage of biomass in fuel blends. This position is strongly supported by the Professional Association of Environmental Engineers of Ukraine (PAEW), which warns that further taxation could weaken domestic industry.
Why it matters now
Biomass energy plays a key role in reducing dependence on fossil fuels.
Alignment with EU tax policy can stimulate investment in clean energy.
Avoiding CO2 taxation on biomass ensures competitiveness of exports under CBAM.
Supporting tax-free CO2 emissions from biomass is more than an environmental measure – it is an economic necessity for countries transitioning to sustainability. By following the EU model, Ukraine can contribute to both climate resilience and industrial capacity in a carbon-regulated world.
Comments
Post a Comment