#13/2025: CBAM conditions for the definitive period still not final

This quarterly setting in the first year provides a more stable and predictable (albeit delayed) price when the definitive system is launched.

 

For example, the price for all imports made in Q1 (January–March) will be calculated in the first week of April.

 

This is a key detail for finance departments. It means that importers will not know the exact carbon price for January imports until after the end of the quarter (in early April). This creates a time lag between importation and final settlement of costs.

 

This transition from quarterly to weekly calculation makes the CBAM price much more sensitive to the current EU ETS market price. Importers' costs will thus be aligned more quickly and accurately with those of EU producers.

 

Specific embedded emissions in imported goods = emissions in tCO2 per ton of product.

From 2026, the payment obligation under the CBAM will be phased in gradually. From the first year, 100% of the specific emissions contained in imported goods will not be charged, but the following will be deducted:

 

a) The portion of emissions for which EU companies are not charged and for which they receive free emission allowances under the EU ETS1. The purpose of this deduction is to ensure that imported goods are subject to the same carbon price as if they were produced in the EU. The main factor in the resulting payment obligation will therefore be the carbon intensity of the third-country manufacturer and how efficiently they produce goods in terms of CO2 emissions compared to EU manufacturers. Free allocation will gradually decrease in the EU, so over time less and less will be deducted from the payment obligation in CBAM, until in 2034 100% of the emissions contained in imported goods will be charged. For this reason, the CBAM payment obligation is being phased in gradually (with a decreasing allocation of free allowances to EU manufacturers).

 

b) Alternatively, the price of carbon paid in a third country.

The formula for calculating the CBAM payment obligation is as follows:

 

The main unknown here is the CBAM benchmark. This will be a value that the European Commission has yet to determine and which will be based on benchmarks for the EU ETS emissions trading system. In the EU ETS, this is a value in tons of CO2 per ton of goods and represents the emission intensity in the production of specific types of products at the 10% most efficient facilities in the EU – these values therefore indicate how efficiently the most efficient facilities in the EU can produce a given product.

The CBAM factor then simply expresses what percentage of the CBAM benchmark will be deducted. This factor will decrease each year, meaning that less and less will be deducted and the payment obligation under CBAM will increase. The CBAM factor will be applied in individual years as follows:

• 2026 = 97,5 %; 2027 = 95 %; 2028 = 90 % 2029 = 77,5 %; 2030 = 51,5 %; 2031 = 39 %; 2032 = 26,5 %; 2033 = 14 %; 2034 = 0 %
• The lower the CBAM factor, the less the CBAM benchmark is deducted from the specific emissions contained in the imported goods.

• Example default value of specific embedded emissions for Algeria: 2.70 tCO2/t
• CBAM benchmark: 1.570 tCO2/t
• No carbon price paid in third countries is considered.
• Certificate price EUR 80 (will correspond to the price of an ETS1 emission allowance)