Breedon calls for clarity on UK carbon import control scheme

(Alliance News) - Breedon Group PLC on Tuesday called on the UK government to provide further clarification on a planned carbon border adjustment mechanism, due to take effect next year.

The regulatory scheme, known as CBAM, aims to prevent "carbon leakage", which a government factsheet defines as "the movement of production and associated emissions from one country to another due to different levels of decarbonisation".

CBAM "will ensure highly traded, carbon intensive products from overseas face a comparable carbon price to that paid by UK manufacturers", according to the factsheet.

Derby, England-based construction materials firm Breedon has flagged five concerns in relation to the scheme, which it says "remains unclear" ahead of implementation on January 1.

Breedon is asking the government to publish the rates and default emissions values which will be used to determine CBAM taxes "as early as practiceable in 2026". It also stressed that default emissions values be carefully calculated, and not "allow higher-carbon imports to underpay for their emissions".

The government is allowing companies and individuals liable for CBAM taxes "to use either independently verified actual emissions data or default emissions values". From 2027, it will introduce "a single default value set per product", and has said it "will confirm the methodology to be used for their calculation and publish default values in advance of the introduction of CBAM".

In addition, Breedon is requesting that cement producers be included in the government's Energy Intensive Industry compensation scheme, arguing that UK cement producers face higher electricity costs than non-UK producers.

The company also stressed that measures be taken to avoid "under-reporting and mislabelling of imported cement". It also called for "clear contingency measures if carbon-intensive imports increase".

Back in March, Breedon launched a campaign to promote UK manufacturing, dubbed "back British cement".

Chief Executive Rob Wood has written to the government ministers and key officials, including Energy Security & Net Zero Secretary Ed Miliband and Business & Trade Secretary Peter Kyle.

The CEO previously has underscored the potential of "public procurement policy to support domestically produced cement".

Wood on Tuesday added that CBAM should strengthen "domestic production in an increasingly insecure world whilst protecting British jobs and delivering economic growth."

Breedon shares rose 0.4% to 304.80 pence on Tuesday morning in London.

By Holly Munks, Alliance News reporter

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