The European Commission has published a technical study on indirect emissions under the CBAM, dated 8 June 2026, through DG TAXUD. The study addresses how emissions from electricity consumed in producing CBAM goods should be calculated. It also covers when importers may claim actual indirect emissions and whether indirect emissions coverage should expand to additional CBAM sectors. (Taxation and Customs Union)
The Commission structures the work around three policy questions. These include how to determine operational default emission factors for indirect emissions, when declarants may claim actual indirect emissions, and whether coverage should extend to more CBAM sectors. The conditions for actual claims include rules for direct technical links, power purchase agreements and verification. (Taxation and Customs Union)
The broader final report describes an analysis combining methodological assessment, review of existing CBAM rules, scenario testing and stakeholder input. It evaluates environmental integrity, carbon-leakage prevention, administrative feasibility and even-handed treatment between EU and non-EU producers. The report also highlights risks including resource shuffling, weak data, verification complexity and overlap with EU indirect cost compensation. (Publications Office of the EU)
Electricity’s role in CBAM compliance
The study’s main signal is that electricity is becoming a core variable for CBAM compliance. It notes that many exporters have previously treated CBAM primarily as plant-level process emissions, including fuel combustion, calcination, process chemistry, reduction agents and furnace emissions. The Commission’s work indicates the electricity side is moving toward a more formal compliance architecture.
The shift is most relevant for aluminium, steel, fertilisers, cement, hydrogen and electricity-intensive processing chains. It is particularly significant for countries outside the EU where grid electricity can have higher carbon intensity than the EU average. For the Western Balkans, Türkiye, Ukraine, North Africa, the Gulf and parts of Asia, the study points to stronger requirements for evidence on electricity origin, metering, consumption boundaries and contractual power supply.
Default emission factors for indirect electricity
One policy area concerns the design of default emission factors for indirect emissions. This involves selecting which emissions factor applies when an exporter or declarant cannot prove actual electricity-related emissions with sufficient quality. The study frames this as a practical decision point within the calculation method.
The commercial importance is linked to how defaults can function as a baseline penalty for weak data. If an exporter cannot document actual electricity consumption and supply, the CBAM declarant may need to rely on a conservative default value. For countries with carbon-intensive grids, this could increase embedded-emissions figures and raise certificate exposure once the definitive system is fully operational.
For exporters, the operational implication is that weak electricity data may become costly. Plants are expected to provide more than total electricity consumption by showing consumption by installation, production line, product route, batch or process boundary. The study lists aluminium rolling, steel rolling, ferroalloys, cement grinding, ammonia production, hydrogen production and precursor production as examples where this affects CBAM readiness.
Actual indirect emissions: links, PPAs and verification
A second policy area examines when declarants may claim actual indirect emissions. It includes requirements covering direct technical links, power purchase agreements and verification processes. The Commission’s publication identifies PPAs and technical links as central design conditions . (Taxation and Customs Union)
The framework described in the study indicates that claims about renewable or low-carbon electricity will require support beyond certificates or supplier statements alone. Credibility for actual-indirect-emissions claims depends on physical evidence, contractual arrangements and verification documentation. This shifts attention toward proof of how low-carbon electricity consumption is established.
The study points to direct technical links as a likely strongest form of proof. Examples include dedicated renewable generation assets connected to production installations or clearly traceable behind-the-meter arrangements. It also notes that PPAs may be relevant depending on whether they demonstrate genuine low-carbon consumption rather than only reallocating clean electricity while physical grid power remains carbon-intensive.
Resource shuffling is highlighted as a key concern in the final report metadata . Resource shuffling is described as contractually assigning clean electricity to CBAM-export production while leaving dirtier electricity for other users without reducing total system emissions. The Commission’s concern is that actual-emissions claims must not become a paper exercise that undermines environmental integrity . (Publications Office of the EU)
For Serbian and Southeast Europe exporters, the study indicates due diligence needs beyond contract documentation. A green PPA would require a credible data package including power meter readings and hourly or sub-hourly consumption records where relevant. It also references generation proof, grid connection documentation, guarantees of origin or equivalent certificate controls, matching logic, settlement records and independent verification.
Extending indirect coverage across CBAM sectors
A third policy area addresses whether indirect-emissions coverage could extend to additional CBAM sectors. Under the definitive CBAM framework described in the summary provided for Task 2, indirect emissions are currently covered for cement and fertilisers . During the transitional period described in that summary, indirect emissions are reported for all CBAM goods except electricity . (Publications Office of the EU)
The Task 3 summary places this question within the broader EU carbon leakage framework. It references elements including the EU ETS Directive, free allocation, indirect cost compensation and the CBAM Regulation . It also notes that state-aid rules define how Member States may compensate electricity-intensive industries for indirect carbon costs passed through power prices . (Publications Office of the EU)
The study describes political sensitivity around extending coverage too widely versus not extending it at all. If coverage expands broadly, non-EU exporters could face higher compliance and cost burdens. If it does not expand, EU producers paying indirect carbon costs through electricity prices could argue imports face no equivalent carbon constraint.
For energy-intensive sectors listed in the study discussion, aluminium is described as an obvious candidate because electricity is central to primary aluminium emissions and cost structure. Steel could be affected particularly via electric arc furnace routes, rolling, downstream processing and hydrogen-based pathways. Fertilisers are noted as relevant because electricity can influence ammonia and hydrogen-related production routes.
Implications for exporters’ data systems
The exporter implication described in the study is that CBAM readiness must include an electricity evidence system . Exporters are expected not to wait for final legal wording before building data architecture supporting calculations. The minimum credible package includes plant electricity balance and production-process boundary maps.
The same package includes product-level allocation rules plus metering hierarchy details . It also references collecting electricity supplier contracts and PPA documentation alongside guarantees of origin or equivalent instruments . The study further includes grid-emission-factor assumptions and an audit trail linking electricity use to exported goods.
For a Serbian steel producer or aluminium producer or cement producer or fertiliser or precursor producer referenced in the discussion of implications , key questions relate to proving what electricity was consumed and when it was consumed. The study also highlights proving where it came from and how it was allocated to exported products so claims can survive importer review and verifier review.
Importer verification requirements
The study indicates that an EU importer or authorised CBAM declarant cannot rely solely on supplier declarations . Instead it describes a mirror-verification protocol requiring supplier data requests followed by plausibility checks on submitted information. This includes reviewing electricity contracts alongside metering evidence.
The protocol described also includes reconciling production volumes with embedded-emissions calculations . It further requires escalation rules if data quality is weak . These steps are presented as part of ensuring embedded-emissions calculations remain consistent with evidence supplied by exporters.
PPAs as a compliance input
The study describes a commercial opportunity for renewable developers outside the EU through PPAs with exporters . A PPA may become more valuable if it helps reduce CBAM indirect-emissions exposure by supporting evidence used in claims. This can improve offtaker credit quality and strengthen bankability for renewable projects serving industrial customers.
PPA value depends on compliance credibility rather than contract labels alone . The study contrasts generic green contracts with structured CBAM-ready PPAs featuring clear metering arrangements, generation matching approaches and certificate retirement processes . It also references grid connection evidence plus delivery shape parameters.
For Southeast Europe renewable markets mentioned in the discussion—Serbia, Montenegro, Bosnia and Herzegovina, North Macedonia and Albania—the study ties relevance to industrial exporters seeking documented low-carbon power . It states that “CBAM-verifiable electricity” is positioned as stronger than relying only on broad green-electricity descriptions .
Technical support before formal verification
The study reinforces third-party technical support needs before formal verification steps . Exporters are expected to use technical consultants familiar with production processes plus electricity systems including metering arrangements and SCADA integration points . This support extends to PPAs handling guarantees of origin instruments emission-factor logic and audit trail preparation.
A practical readiness review described in the study covers electrical single-line diagrams along with grid interfaces and self-generation interfaces . It also includes metering points plus transformer and substation records along with SCADA logs tied to production-line consumption . Additional elements include production allocation rules PPA settlement data certificate registry evidence plus reconciliation between production volumes and electricity consumption.
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