Post by CO2 IQ

💶 CBAM costs become effective in 2026: Unpacking the price tag for imported goods into the EU The EU Carbon Border Adjustment Mechanism (CBAM) puts a carbon price on imports from January 1. To comply, European importers of steel, aluminium, fertilisers, cement, electricity, and hydrogen will need to purchase CBAM certificates. But how much will they have to pay? The formula is simple in theory — but 4 of the 5 input factors come with uncertainty: 1️⃣ Emissions values: For now, there is little assurance about CBAM conformity of data coming from suppliers (until these data gets verified). 2️⃣ Goods specific benchmarks: They adjust CBAM costs for free emission allowances in the EU-ETS and are expected to be published later this year. 3️⃣Third-country carbon prices: Calculating carbon prices effectively paid is difficult. To help, the EU plans to publish default prices. 4️⃣CBAM certificate prices: They will be derived weekly based on EU-ETS auctions. Large fluctuations add a new price risk to be hedged. With low costs predictability, importers face new financial uncertainty. But one thing is certain. CBAM will soon become a material line item in procurement and pricing decisions for many importers. 🧮 Want to understand the drivers and how to prepare? Check our blog. Link in comments 👇 #CBAM #CarbonPricing #EUETS #Import #SupplyChain #Decarbonization