The Clean Competition Act would create a carbon border adjustment charge on imports of carbon-intensive goods and impose charges on domestic producers of those same goods based on their carbon intensity relative to industry benchmarks. Starting in 2025, importers would pay charges on covered primary goods like steel, cement, chemicals, and aluminum, with the charge amount depending on how much the product's carbon emissions exceed a percentage of the industry standard. Domestic manufacturers would face equivalent charges on goods they produce if their carbon intensity exceeds the applicable benchmark. The applicable percentage would start at 100 percent in 2025 and gradually decline by 2.5 to 5 percentage points annually, eventually reaching zero by 2034 or later. The carbon price would begin at $55 per metric ton of CO2 equivalent in 2025 and increase annually by the inflation rate plus 5 percentage points. The bill would also establish a competitive grant program funded by 75 percent of the new revenues to help manufacturers reduce their carbon intensity, with preference given to projects in economically distressed areas, and direct 25 percent of revenues to international climate assistance through the Department of State.
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