Navigating Dual Carbon Pressures: Impacts of China’s National ETS and the EU CBAM on the Cement and Aluminum Sectors

As global climate change intensifies, countries around the world are adopting measures to reduce greenhouse gas emissions. With the European Union’s Carbon Border Adjustment Mechanism (CBAM) scheduled for full implementation in 2026, China’s energy-intensive industries-particularly cement and aluminum-will face significant challenges under the dual pressure of domestic and international carbon-pricing mechanisms. This study examines the impacts of China’s Emissions Trading System (ETS) and the EU’s CBAM on the cement and aluminum sectors. Exploring this issue helps clarify how these mechanisms influence firms’ operating costs, competitiveness, and low-carbon transitions, while also offering policy and strategic responses to advance global green and low-carbon development. Since 2004, China has gradually built a comprehensive emissions-trading framework, evolving from its participation in the Clean Development Mechanism to regional pilot programs and ultimately to a unified national market. Existing research indicates that carbon markets can effectively reduce abatement costs through market mechanisms. However, the suitability of different allowance-allocation methods-such as historical emissions-based allocation and benchmark-based allocation-varies across industries like cement and aluminum, making industry-specific optimization essential. Meanwhile, the introduction of the EU’s CBAM provides new perspectives for global carbon governance but also affects China’s cement and aluminum industries in terms of export costs, market competitiveness, and pathways for industrial transformation. Confronted with dual domestic and international pressures, China’s cement and aluminum sectors must enhance their competitiveness through technological innovation, energy-structure optimization, and improved carbon data management, thereby transforming challenges into opportunities for upgrading and transition.