OUT NOW: What is going on at the halfway point of #COP29 ? The latest episode of the Let Me Sum Up podcast features finance galore, ambition updates, unilateral measures, and special guest @DrSimEvans

OUT NOW*: the Let Me Sum Up wrap-up on #COP29. What’s the big deal with the Big Deal? How did mitigation get Rule 16’d? Where were UTMs? We break it all down! * ok out earlier today, I’ve been in COVID nap mode

This is a fun episode, and a long time coming!

@Peters_Glen @MatthewWithy @rishpardikar @michaelxpettis (Also: thanks all for a thoughtful thread! Seems like old times)

@Peters_Glen @MatthewWithy @rishpardikar @michaelxpettis To me the main point of CBAM is to make deeper emissions cuts viable (economically and politically) within the adjusting economy. Consumption switches at home, decarb incentives abroad are bonuses, with plenty of room for other dedicated policies/approaches

@Peters_Glen @rishpardikar @michaelxpettis In PV, polysilicon stage is most of the total end product emissions. Maybe adjusting for that would be worthwhile? worth some work. EVs: I just don’t think the C price would matter much to final product competitiveness. And an adjustment would in no way settle wider trade fights.

@Peters_Glen @rishpardikar @michaelxpettis On the one hand 🇨🇳 EV, batt, PV industries are marvels & net global goods. On the other hand, current extent of domination is fairly risky for all, and results in part from broader economic policies that are increasingly dysfunctional. Messy!

@rishpardikar @Peters_Glen The import adjustment is tied to a domestic cost impost from which EU steel makers etc will no longer be shielded (noting both the phase in of CBAM and lockstep phase out of free permit allocation to EU producers will be gradual through 2034). Dynamic quite different to tariffs

@rishpardikar @Peters_Glen W/ domestic EU C price + directly equivalent import adjustment, all suppliers will recover at least the bulk of their carbon costs from EU consumers (and more than the bulk if they are relatively carbon efficient). If importer carbon cost is paid at home, net flow is pretty just!

@Peters_Glen @rishpardikar I explored potential impacts of the EU CBAM on Australian exports in this paper a few years ago:

@Peters_Glen @rishpardikar Totally reasonable! Though arguably in the Gillard era the price and the compensatory tax and transfer changes were too weakly linked in public messages (though that doesn’t seem the case with Canada’s system, which seems in peril too)

@rishpardikar If a bottom quintile household’s income goes up (due to redistribution) by more than their cost of living (due to an electricity price rise) they do not need to consume less electricity. Can do via benefit increases, low/middle income tax cuts, lump sums, targeted public services

@rishpardikar The authors of the paper find encouraging results for equity with lump sum transfer of revenues. It’s a simplistic scenario (like the whole policy scenario examined) and could be improved on in practice, though they also note challenges to be navigated. Equity definitely matters!

Episode also features: - COP29 preview - what’ll happen in Baku? - Trivia near-triumphs - perhaps the last ever ribbing over the elusive CLRP2 Send papers and feedback to mailbag@letmesumup.net Sustain the summing-up at