Are you prepared for CBAM's financial impact? Discover how it may reshape your import strategies.
What Questions I Will Answer in this blog
What is the Carbon Border Adjustment Mechanism (CBAM), and why does it matter?
How are CBAM certificate costs calculated, and what factors influence them?
What can businesses do now to prepare for CBAM compliance and cost planning?
Introduction
The Definitive Scheme of the EU’s Carbon Border Adjustment Mechanism (CBAM) is fast approaching in 2026, with final preparation beginning in 2025. These groundbreaking regulations are poised to transform how carbon-intensive goods are imported into the EU, introducing new business costs and challenges. Preparing now is essential to maintaining compliance, competitiveness, and financial resilience.
"CBAM can come at a high cost to businesses; 2025 will require businesses to deal with more red tape and more costs - even before the actual CBAM payments start in 2026." — Arne Mielken, Managing Director of Customs Manager Ltd
Abbreviations I Use in this Blog
To make this blog easier to navigate, here are the key abbreviations I’ll use:
CBAM: Carbon Border Adjustment Mechanism – A mechanism aligning carbon costs for EU-produced and imported goods.
EU ETS: EU Emissions Trading System – The EU’s carbon market, setting the price of emissions.
What is CBAM, and Why Should You Care?
The CBAM is designed to level the playing field between EU-produced and imported goods by applying a carbon price to imports. This price mirrors the EU ETS, ensuring that carbon-intensive products do not gain an unfair cost advantage.
From 2026, importers of CBAM-covered goods, such as steel, cement, and aluminium, will gradually be required to purchase CBAM certificates. These certificates will reflect the carbon emissions associated with their production. In 2025, the systems, laws, and regulations required to establish this system will be put in place.
CBAM impacts your bottom line and presents an opportunity to align your operations with the global push toward sustainability. By understanding and addressing CBAM’s cost implications now, you can ensure your business remains compliant and competitive.
2025 CBAM Expert Webinar: 20 March 2025
Join us for an in-depth webinar designed to guide businesses through the complexities of the EU's Carbon Border Adjustment Mechanism (CBAM) as it transitions into its definite operational phase in 2026. This session is tailored to help you stay ahead of regulatory requirements and ensure compliance with the evolving CBAM rules.
Topics to Be Covered:
Authorised CBAM Declaration Status
What is it, and how can you obtain this crucial status for your business?
Navigating the Definite CBAM Registry
Learn how to effectively work with the EU's registry system for streamlined reporting and compliance.
New EU Legislation
Overview of upcoming rules that will further define CBAM implementation and their impact on your operations.
Engaging Third-Party GHG Emission Verifiers (2025/2026)
Understand the role of verifiers and how to collaborate effectively as the system matures.
Carbon Pricing Across Countries
Insights into carbon prices globally, how to account for them, and their impact on your CBAM obligations.
CBAM Certificates: Purchase, Surrender, and Payment
A comprehensive guide on CBAM certificates, including when and how to surrender them and calculate associated costs.
Simplifications for CBAM Reporting
Practical tips for submitting accurate CBAM reports and utilising simplifications to reduce the administrative burden.
Changes to Exemptions
Explore planned changes to exemptions and what they mean for businesses.
Preparing for CBAM's Operational Phase in 2026
Step-by-step guidance on what businesses should be doing now to prepare for full implementation.
Who Should Attend?
This webinar is essential for EU and non-EU customs professionals, sustainability officers, trade compliance managers, and anyone involved in import/export operations within carbon-intensive sectors.
Details
Date: Thursday, 20 March 2025
Times :
3pm-4pm London time (GMT)
4pm-5pm Brusssles Time (CET)
10am-11am New York Time (EST)
8 am Dallas (CST)
7am Los Angelos (PST)
Location: Online, using Zoom
Duration: 60 minutes
Cost:
Participants fee: 100 GBP (approximately 125 Euros / US$)
Free for Premium Members of our Trade Intelligence Services with use of coupon code.
Register today to gain actionable insights and prepare your organisation for the CBAM's definitive operational period. www.customsmanager.org/events
How Are CBAM Certificates Costs Calculated?
Businesses should start to begin to understand the costs of CBAM certificates to be able to evaluate the financial impact of CBAM on their imports.
Here’s what you need to know to get you started when considering the CBAM costs for CBAM certificates:
1) Production-Specific Emissions Value
The emissions data producers provide determine the carbon footprint of your imported goods. Accurate reporting is crucial for cost management. Reliance on average national emission values could lead to significantly higher costs if the exporting country has high carbon intensity.
2) Goods-Specific Benchmark
Benchmarks, set by the EU Commission, provide reference emissions values for each production unit. These values will serve as a baseline for calculating CBAM costs. Ensuring your products align with or outperform these benchmarks can save costs.
3) Year-Specific CBAM Factor
The CBAM factor adjusts costs to account for the gradual reduction of free allowances under the EU ETS. As free allowances diminish, CBAM costs will rise.
4) Weekly EU ETS Prices
CBAM certificate prices will fluctuate in line with the weekly EU ETS price. This dynamic cost element requires importers to closely monitor ETS trends and integrate them into their financial planning.
Key Insight
Countries with high-carbon-intensity production, such as coal-heavy energy sources, will incur higher costs. Strategic supply chain adjustments can help mitigate these expenses.
What Can Businesses Do to Prepare?
While some rules are still pending, businesses can take actionable steps today to prepare for CBAM compliance.
Estimate CBAM Costs
Start understanding your potential CBAM-related costs by looking at
Emissions data for your imported goods
EU ETS price trends
Country-specific emission averages
Optimise Your Supply Chain
Consider sourcing from countries with lower carbon intensity or engaging suppliers who can provide accurate emissions data. Investment in lower-carbon production technologies may also yield long-term benefits.
Monitor Regulatory Updates
Staying informed is critical. The CBAM framework is still evolving, and understanding new rules as they emerge will give you a compliance edge. Regularly consult with customs professionals to ensure you’re on track.
How We Can Help
Navigating the complexities of CBAM can be daunting, but you don’t have to do it alone. Here’s how I can support your business:
CBAM Cost Calculations: Tailored analysis to help you plan for the financial impact of CBAM.
Regulatory Guidance: Updates on the latest CBAM rules and benchmarks.
Strategic Advice: Support in optimising your supply chain to minimise CBAM-related costs.
Customs Training: Expert-led training sessions on CBAM and related customs issues.
Arne’s Takeaway
The CBAM is more than just a regulatory challenge; it’s a call to action. Understanding the costs, adapting your supply chain, and aligning with sustainability goals can turn this potential obstacle into a competitive advantage. Start preparing today, and secure your business’s place in a greener, more resilient future.
Expert Recommendation
Conduct a detailed analysis of your imports’ carbon footprints.
Align with suppliers to secure accurate emissions' data.
Monitor EU ETS price trends to anticipate cost fluctuations.
Engage with a customs professional to stay informed on regulatory changes.
Suggest investing in lower-carbon technologies to reduce long-term expenses.
Fancy a call?
READY TO PREPARE FOR CBAM? I offer comprehensive support for CBAM cost planning and compliance. I would love to talk to you about your questions and challenges with CBAM. I offer a free expert call of up to one hour, which you can book seamlessly here.
Need More?
I provide public, in-house, and on-demand training tailored for customs professionals, importers, exporters, and their partners. For more details on services, visit www.customsmanager.org/shop .
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