The LME is committed to supporting and advancing responsible and sustainable practices in the metals industry. Having implemented responsible sourcing rules in 2019 and launched their digital sustainability credentials register, LMEpassport, in 2021, we are now seeking to leverage what we’ve already done by seeking views on proposals to help drive further development in the fast-evolving sustainability landscape.
Their consultation and discussion papers issued in May 2024 encourage feedback on how best to meet the challenges of upcoming regulatory changes and how we can support the industry’s progress towards a more sustainable future.
Consultation paper: Proposed LME Action on the Carbon Border Adjustment Mechanism (CBAM)
What is CBAM?
The CBAM is an EU policy that aims to mitigate carbon leakage by imposing a cost on certain carbon-intensive goods – including aluminium – imported into the EU. The CBAM regulation is designed to ensure that imported goods pay a price for their carbon emissions that is comparable to the price paid by EU domestic producers under the EU’s Emission Trading System (ETS), thereby discouraging the relocation of production to countries with less stringent environmental policies.
What is their proposal?
We propose to introduce new requirements from March 2025 for producers of all LME-listed aluminium brands (including primary aluminium, aluminium alloy and NASAAC) to upload verified emissions data to the LME’s digital credentials register, LMEpassport, in line with the EU CBAM regulation.
How can this help aluminium industry participants?
Embedding the aluminium emissions reporting seamlessly into LMEpassport would help industry participants in the following ways:
- support the efficient flow of information across the value chain
- reduce the administrative burden for producers in providing a one-stop shop for emissions data
- equip market participants with accurate data to make informed decisions.
The proposal is designed to pave the way for the integration of further regional policy changes that are expected to follow.
Discussion paper
Their discussion paper seeks the views of the market in seven key areas:
Key timings and feedback
The CBAM consultation and sustainability discussion paper periods are both open until 14 June 2024, 17.00 (BST).
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Thereafter, the LME will take any received market feedback into consideration with the aim of publishing a response paper, detailing next steps in the second half of the year.