How does CBAM mirror the EU Emissions Trading System (ETS)?

CBAM as an extension of EU ETS principles to imports

CBAM is designed to mirror the EU ETS by applying a similar carbon pricing mechanism to imported goods. Like the ETS, CBAM is based on a system of certificates. The price of CBAM certificates is calculated to match the price of EU ETS allowances, ensuring that imported goods face the same carbon costs as goods produced within the EU. This approach aims to create a level playing field and prevent carbon leakage.