The European Commission has confirmed that indirect emissions will not be taken into account for steel products under the upcoming Carbon Boundary Adjustment Mechanism (CBAM), while scrap destined for consumption should become an independent CBAM product, European Commission representative Martin Becker said during the European Round Table on Climate Change and Sustainable Transition. Webinar (ERCST) on Thursday, October 30th.
The CBAM program will enter its final phase on January 1, 2026 and is designed to level the playing field between domestic producers who are subject to the EU's Emissions Trading System (ETS) and international producers who are not subject to the same requirements.
Despite the rapid approach of the CBAM, the EU Commission is still finalizing the details and clarifying the policy elements. Some concerns were resolved on October 30 during the ERCST webinar, where Martin Becker, Deputy Head of the EU division, provided additional information about the upcoming changes.
In particular, Becker said that additional measures will be taken to prevent circumvention, indirect emissions will remain off limits for the foreseeable future, and waste destined for consumption will become his own CBAM product.
"As part of the December[legislative]proposal, we are not only introducing additional measures to combat license circumvention, but also expanding the product range to include some subsequent CBAM steel and aluminum products," Becker said at the webinar.
"This channel of evasion[to a certain extent]will be closed with the expansion of the scope of application," he added.
Circumvention opportunities will be eliminated
Market participants have been expressing concern for some time about the possibility of circumventing CBAM obligations with misleading statements about emission intensity. This is "possible because we rely on the customs infrastructure, which was created to collect customs duties, rather than to ensure compliance with environmental legislation," Becker said.
"A more detailed customs declaration would allow[the EU]the European Commission to better control the situation, and customs would have something to cling to during inspections. This is something that is under development," he said. "At this stage, there is no complete visibility of the supply chain, and this limits our ability to track the product to the installation where it was produced. This is a weak point that operators can exploit."
"Obviously, we need to address this gap in monitoring," he added.
Becker proposed to introduce methods similar to those used in the framework of protective measures against steel.,
