The key benchmarks for calculating the unit cost of steel imports in the upcoming financial phase of the Carbon Dioxide Emissions Control Mechanism (CBAM) are likely to be officially announced no earlier than the first quarter of 2026, as McCloskey learned from private correspondence with the European Commission.
In a letter from Gerasimos Thomas, Director General of the European Commission on Taxation and Customs Union, a representative of the Commission indicates that the CBAM benchmarks "will be based on the relevant[European Union Emissions Trading System]benchmarks," which are "updated for the period 2026-2030." The letter is dated earlier this week and was viewed by McCloskey on October 1.
Gerasimos said he expects the criteria for the EU carbon market"to be adopted only in early 2026. This means that the final list of CBAM criteria can only be available at the moment."
The criteria for the EU carbon market track the allocation of free quotas to various facilities covered by the scheme to prevent carbon leakage or companies leaving the European Union to start operations in unlicensed jurisdictions. the carbon pricing mechanism. As CBAM is phased out from 2026 to 2034, businesses across Europe will gradually receive fewer and fewer free carbon allowances until they are completely eliminated by 2034.
European steel importers are working on the expectation that the CBAM benchmarks, which are multiplied by the free allocation, will be monitored by the CBAM coefficient, and then subtracted from the total embedded emissions, will be presented before the end of this year. This was done on the basis of the European Commission's Action Plan for Steel and Metals Production, recent consultations on the technical aspects of CBAM, and its commitment to publish acts on the implementation of control regulations in the fourth quarter.
However, it is important to note that the Commission's commitment to clarify the rules governing benchmarks is not final. The mandatory obligation to make public the specific values themselves may be limited to specifying the correspondence between the two systems.
Gerasimos' letter coincides with McCloskey's previously published response from the European Commissioner for Climate, Wopke Hoekstra, to Filip Turek – a Czech MEP – in early September about the CED-CBAM benchmark for interdependence, undermining European steel importers' expectations that official CBAM indicators will be available before 2026.
As the main part in the Formula for calculating the size of embedded emissions
