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LATEST: Claims Tipperary households set for electricity bill increase 'misleading'
The EU’s Carbon Adjustment Mechanism (CBAM) adds a carbon cost to some imported goods, including steel, cement, and electricity. This helps the EU maintain consistent carbon prices across imports and goods produced within the EU.
Reporter:
Darragh O’Flynn
05 Jan 2026 8:46 PM
The EU’s Carbon Adjustment Mechanism (CBAM) adds a carbon cost to some imported goods, including steel, cement, and electricity with concerns that the new tax could leader to higher energy costs for Irish households.
The CBAM helps the EU maintain consistent carbon prices across imports and goods produced within the EU.
The process begins in 2026 and many believe it could raise energy bills for Tipperary users, as the EU aims to create fairer conditions and improve air quality.
Deputy Alan Dillon spoke about this issue at the Oireachtas committee before Christmas.
“CBAM is an instrument implemented by the European Union to address the risk of carbon leakage,” Dillon said.
“The EU's ambition is to become climate-neutral by 2050.
CBAM is designed to ensure imported goods face the same carbon price as goods made in the EU. For the electricity sector, this means putting a cost on emissions from electricity generated outside the EU and imported.
"The goal is to promote sustainable practices and lower carbon emissions. At first, electricity importers will need to report the direct emissions from imported electricity every quarter, using information from their suppliers.
"The simplification package, released in February and adopted in October, allows the European Commission to better reflect the carbon price paid, including for imports from Britain. Ireland supports this change. CBAM is changing quickly."
Dillon addressed concerns about possible price increases for customers, saying that such predictions would be "inaccurate" right now.
“The week ending 12 December saw voting on some implementing regulations and acts, and other votes are to follow in the days and weeks ahead,” he said.
“At this time, until the exact details are clear, any estimate of the cost of CBAM relative to electricity imports is likely to be inaccurate.
"Overall, CBAM gives the electricity sector a chance to support sustainability and help protect the environment. It also encourages businesses to be seen as responsible and environmentally aware.
"We are working closely with the European Commission to adopt a simplification package, introduced in October, to clarify reporting and carbon price alignment. Until the Act is finalized early next year, any cost estimates would be speculative and misleading.
"We have several engagements with the European Commission. We have had several meetings with the European Commission.
"It is also working closely with the UK to align carbon costs with the EU Emissions Trading System. Our main goal is to encourage the adoption of cleaner energy worldwide."
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