In the United States, Europe, and elsewhere, policymakers have noticed that producers’ carbon emissions differ in different parts of the world—and politicians are increasingly crafting regulations based on that variance. Examples include: import tariffs dependent on products’ embedded emissions, such as the E.U.’s Carbon Border Adjustment Mechanism or the U.S.’s Foreign Pollution Fee Act; mandatory carbon labelling for certain high-profile, high-emissions products such as in the E.U.’s Battery Regulation; and public procurement rules that favor low-emissions products.
