Designing Border Carbon Adjustments for Enhanced Climate Action

Abstract

The Paris Agreement advances a heterogeneous approach to international climate cooperation. Such an approach may be undermined by carbon leakage—the displacement of emissions from states with more to less stringent climate policy constraints. Border carbon adjustments offer a promising response to leakage, but they also raise concerns about their compatibility with international trade law. This Article provides a comprehensive analysis of border carbon adjustments and proposes a way to design them that balances legal, administrative, and environmental considerations.