The CBAM cost overview shows the key information for reporting and cost estimation for each affected non-EU supplier. It creates transparency regarding imported embedded emissions and potential CBAM costs.
📌 What Does the Overview Show?
Category | Description |
Supplier Name & ID | Unique identification of each affected non-EU supplier. |
Country | Supplier’s country of origin – relevant for CBAM applicability. |
CN Codes | Customs tariff numbers of imported products – decisive for CBAM coverage. |
Total Quantity (t) | Total imported quantity per supplier in tonnes for the reporting quarter. |
Ø Emission Factor (t CO₂e/t) | Average specific emission value per tonne of imported goods (weighted average). |
Total Emissions (t CO₂e) | Total CO₂ emissions per supplier: Quantity × Ø Emission factor. |
CBAM Factor (%)* | Annual deduction factor for the benchmark according to phase-in. |
CBAM Certificates (t CO₂e) | Reflects the amount of CBAM certificates potentially required per supplier from 2026 onward. |
Ø EUA Price (€) | Average price per tonne of CO₂ in the EU Emissions Trading System (EU ETS) during the period. |
CBAM Costs (€) | Simulated costs for certificates based on the EUA price – useful for budgeting. |
Reporting Quarter | The reporting period for the data (e.g., Q1 2025). |
* Further explanation of the CBAM factor:
The CBAM factor is the central control variable through which the EU mirrors the phase-out of free allocation in the EU ETS into the CBAM system. It determines what share of the embedded emissions of an imported product must actually be covered with CBAM certificates.
There are two perspectives that are used in official documents and in the specialist literature in parallel:
Benchmark coverage factor (often called “annual factor”): This indicates the share of benchmark emissions of a product that is still considered “discounted.” In 2026, this value is 97.5%. The higher this factor, the larger the deduction granted from the embedded emissions.
Phase-in rate: This is the direct counterpart and describes the share of emissions that are subject to CBAM. In 2026, this rate is 2.5%. Each year, this percentage rises until, by 2034, 100% of the emissions are subject to CBAM.
Both figures are complementary. They can be seen as “two sides of the same coin”: either you describe how much is still discounted (97.5% in 2026) or how much is already subject to CBAM (2.5% in 2026).
What does the CBAM factor do in practice?
The lower the factor, the smaller the deduction and the higher the amount of CBAM-liable emissions. Over the years, the factor is gradually reduced until it reaches zero in 2034. From that point on, no benchmark deduction will be granted, and all embedded emissions must be covered with CBAM certificates.
CBAM Benchmark Formula (Target Design)
Once the European Commission publishes the CBAM product benchmarks, the calculation logic will be as follows:
CBAM-liable emissions = embedded emissions − (CBAM benchmark × annual factor)
(followed, where applicable, by a deduction for a CO₂ price actually paid in the country of origin).
What is the CBAM Benchmark?
The CBAM benchmark is a reference value for emissions per unit of product. It is set by the EU and is oriented toward benchmarks from the EU ETS, but is not necessarily identical. While ETS benchmarks map individual production processes, CBAM benchmarks are set at the product level or according to customs tariff codes. They serve as the deduction basis in the official formula. This means that part of the actual emissions of a product is deducted, with the size of the deduction determined by the annual factor.
As long as the official CBAM benchmarks have not yet been published, we use a pragmatic mid-case assumption for budget orientation:
Assumption: Actual emission factor ≈ CBAM benchmark.
Calculation rule 2026:
CBAM quantity ≈ Total emissions × (1 − annual factor) ⇒ ≈ Total emissions × 2.5% (for 2026).Limitation: If actual is significantly higher than the benchmark, this approximation underestimates the CBAM quantity. If actual ≤ benchmark × annual factor, the exact CBAM quantity would be 0.
Year | Remaining to benchmark (only if Actual ≈ Benchmark) |
2026 | 2.5 % |
2027 | 5 % |
2028 | 10 % |
2029 | 22.5 % |
2030 | 48.5 % |
2031 | 61 % |
2032 | 73.5 % |
2033 | 86 % |
2034 | 100 % |
Explanation: These values correspond to (1 − CBAM annual factor). Example 2026: factor 97.5% ⇒ 2.5% remaining to benchmark.
What can I derive from this overview?
Risk assessment per supplier: Where do the highest potential CO₂ costs arise?
Need for action: Which products/sources should be switched to lower-emission alternatives?
Budget planning: What range of CBAM costs arises depending on benchmark assumption and EUA price?
📣 Practical Tip
A high emission value per tonne (high emission factor) combined with large volumes leads to significant cost risks. Use this overview to engage with suppliers – e.g., to request certified emissions data or to switch to more climate-friendly processes.