CBAM Updates: What’s New in April, 2025?

A number of CBAM and carbon-reporting-related updates have been released this year, bringing uncertainty — and occasionally relief — to manufacturers and importers of high-carbon goods. Here, we walk through what’s new as of April, 2025, and what installations and importers need to know to navigate these changes.

CBAM reporting obligation threshold change

The major CBAM update this year has been the changing of the reporting threshold from EUR 150 per consignment to 50 tonnes or 100 tCO2e per annum, per EORI. This is based on default values (which are notoriously punitive), and will likely mean that, for steel and aluminium in particular, the tonnage threshold will be lower than 50 tonnes.

What does this update mean for CBAM as a carbon mechanism? Although just 20,000 companies now remain in scope (compared to an estimated 200,000 previously), 99% of emissions are still captured.

EU precursors are no longer in CBAM reporting scope

Aside from needing to comply with a UK CBAM, there is now no requirement for EU-based businesses to prepare EU CBAM data. No accounting has to be performed for EU-origin precursors, as an ETS charge has already taken place. It’s unclear how the CBAM benchmarks will be applied for these products. In addition, the implications of the UK CBAM on EU-UK exchange of goods will still require installations in the EU to prepare product-level information for reporting.

This will also affect non-EU businesses that purely purchase material of EU origin, as their CBAM emissions intensity will also be considered zero.

Maximum cost of CBAM on goods going to the EU in 2026 — time for better carbon data!

The maximum cost of CBAM applied to goods entering the EU next year will be based on the default values at the CN Code level, the CBAM benchmark, and whether or not a carbon price is paid in the country of origin.

If you’re importing to the EU and still relying on default CBAM data, this should be a wake-up call. At a certain tonnage volume, it will make far more sense to invest in getting actual data, as default values are likely to be highly punitive, as they will be defined by the average intensity of the 10 worst-emitting countries producing these products, where data is available.

Emissions calculation simplifications for downstream

Downstream processing emissions of aluminium and steel products will be excluded from the scope of EU CBAM. The threshold for what constitutes "downstream processing" is unclear, but at CarbonChain, we’re running on the assumption that if your operations would not be captured by the EU ETS, you’d be considered out of scope of the requirement to calculate your own emissions’ contribution to your finished goods.

What does this mean? It means EU CBAM carbon accounting for many manufacturers will now be a simpler exercise, as they will only have to allocate precursor emissions to finished goods and can effectively ignore their operational emissions. It’s unclear if this allocation exercise will still require verification, although at CarbonChain, we will be running on the assumption that verification will still be required. You can read more about commercial considerations for producers of CBAM goods here.

CBAM costs will vary

There are two variables that will determine a company’s final CBAM cost: EUA (European Union Allowance) price and emissions intensity.

EUA price

The EUA is A tradable permit under the EU Emissions Trading System (EU ETS) that allows the holder to emit one metric ton of CO₂ (or its equivalent in other greenhouse gases).

The EUA price reflects the market cost of emitting carbon in the EU. CBAM Certificates will be priced based on EUA prices, on a quarterly basis for 2026, and can easily be hedged via EUA hedges. Companies that want to manage away risk in this way will be able to.

Emissions intensity

However, emissions intensity is another challenge entirely. The figure a company relies on to calculate CBAM cost for 2026 imports is the 2026 calendar year intensity from the installation, which they will only learn in 2027, when their accounting is complete. Furthermore, in early 2027, this figure will need to be verified. So while companies may have their 2025 figures, and could look to base their cost on this 2025 figure, they are heavily reliant on trusting that the installation has done their calculation correctly, and that this calculation passes through verification without any hiccups.

How can businesses calculate their actual CBAM cost exposure in advance?

While businesses can purchase certificates from 1 February 2027, in reality, they may not know their actual certificate exposure until Q2 at the earliest, once they receive verified emissions data from their suppliers.

This is understandably a concern for importers. To reduce risk, we suggest seeking out partners like CarbonChain, who can help with high-quality carbon forecasting for installations.

Deadline for first annual CBAM declaration has been pushed back

It’s not news that CBAM reporting will be required annually in the definitive period. However, importantly, the deadline for the first annual CBAM declaration has now been pushed back until 31 August 2027. This means that, for many companies, reporting will take a back seat to emissions data collection and EUA hedging considerations during 2026.

Before reporting, companies need to register as CBAM Authorised Declarants.

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