To accurately report, as an importer, you need to gather specific information from the operator of the production facility where the goods you import are produced. To address this, follow these steps:
Step 1: Define the imported CBAM goods (Tip: Use the free CBAM Identifier) and understand how they correspond to each “aggregated goods category” (an aggregation of CBAM goods with different CN codes suitable for common monitoring rules).
Step 2: Identify all parameters you need to request from the operator and report on:
– Direct emissions of the installation: The operator has two options available:
- a) The “calculation-based” approach utilizes quantities of all fuels and relevant materials consumed, along with corresponding “calculation factors” (including the “emission factor” based on the fuel or material’s carbon content).
- b) The “measurement-based” approach involves measuring the concentration of greenhouse gases and flue gas flow for each “emission source” (stack). However, during the introductory period until July 31, 2024, other methods allowed for emissions monitoring in their jurisdiction may be applied if they result in similar emission coverage and accuracy.
Indirect emissions: These occur when electricity is consumed by your supplier’s installation, regardless of whether the electricity is produced within the installation or imported.
Precursors (optional): The operator’s detailed precursor data reporting to you, as the reporting entity, is optional since you don’t need to report this information separately in the CBAM report. However, precursor emissions must be included in the reported data for the CBAM good.
Step 3: Is a carbon price applicable in the jurisdiction where the goods or precursor goods are produced? To ensure similar treatment between installations in the EU ETS and other countries, paying a carbon price where CBAM goods and their precursors are produced will reduce the CBAM obligation from 2026 onwards. Reporting on this is also required during the transitional period of the CBAM.
Step 4: Understand the operator’s reporting period. The default is the (European) calendar year.
Step 5: The operator must communicate embedded emissions data to you, the EU importer(s) responsible for reporting under the CBAM Regulation. At the end of each reporting period, the operator compiles monitored data, determines attributed emissions of each production process, and divides them by the corresponding “activity level” to obtain specific embedded emissions of the good. This, along with additional qualifying parameters mentioned in steps 2 and 3, is the main information you need from the operator.
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