The 4-step guide for your suppliers of CBAM goods
published on
8.11.2024
With the Carbon Border Adjustment Mechanism (CBAM), the European Union (EU) is launching a new system to reduce emissions from imported goods. From 2024, companies in the EU that import products such as iron, steel, cement, aluminium and fertilizers from non-EU countries will have to submit CBAM reports and document the emissions of the goods supplied. For companies, this means that they will have to work closely with their suppliers outside the EU to collect the required emissions data.
As many non-EU suppliers may not yet be familiar with CBAM regulations, structured training can be helpful. In our white paper "CBAM: The 4-step guide for your suppliers of CBAM goods", we present a guide that serves as a training document for your suppliers and ensures that all parties involved are familiar with the CBAM requirements.
1. definition of process limits and reporting periods
In order to record accurate emissions data, suppliers must define the specific boundaries of their production processes and determine the reporting period. The documentation includes the identification of production processes and a clear distinction between direct and indirect emissions generated during the production process. The recommended reporting period is the calendar year, but alternative periods, such as the financial year, are also possible, provided they meet the CBAM requirements.
2. determination of the emission monitoring method
Suppliers can choose between different monitoring methods:
The choice of method depends on the conditions of the production plant and the requirements of the CBAM rules. Special methods are prescribed for some production areas, such as the production of primary aluminum. More on this in the white paper.
3. collection and documentation of all relevant parameters
The collection of all necessary data is crucial for correct reporting. This includes monitoring direct emissions, heat consumption and indirect emissions caused by the use of electricity. Suppliers must ensure that all parameters, such as the specific emission factor for electricity and emissions from precursors, are recorded and documented.
4. communication of emissions data to EU importers
The collected emissions data must be transmitted in a standardized format to the EU importers who submit the CBAM reports. The European Commission provides a template for this purpose that facilitates the exchange and supports compliance with the reporting obligations.
Given the likelihood that suppliers outside the EU may not yet be familiar with CBAM regulations, it is advisable for affected companies to provide information and undertake training-type activities at an early stage.
To meet CBAM requirements, companies can use Tacto to facilitate communication and data collection with non-EU suppliers. Tacto provides a structured solution that enables automated data collection and tracking, allowing companies to comprehensively monitor their supply chain and reliably document all CBAM-relevant information.
In the white paper "CBAM: The 4-step guide for your suppliers of CBAM goods", we present a detailed 4-step guide that you can forward directly to your CBAM-relevant suppliers. This serves as an initial training document to ensure that all parties involved are familiar with the CBAM requirements. The guide is written in English as it will be sent to suppliers outside the EU.
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