A Price and a Playbook: What EU's Latest CBAM Related Moves Mean

The Carbon Border Adjustment Mechanism, or CBAM, charges importers of carbon-intensive goods the same carbon price EU producers already pay under the EU Emissions Trading System (EU ETS). It covers six sectors: cement, iron and steel, aluminium, fertilizers, electricity, and hydrogen. Since January 1, 2026, when CBAM’s definitive phase began, that price has stopped being theoretical.

On July 6, 2026, the European Commission set the CBAM certificate price for the second quarter of 2026 at EUR 75.28 per tonne of embedded CO2, the volume-weighted average of EU ETS auction prices for April through June. That’s down eight cents from the EUR 75.36 set for the first quarter. Four such quarterly prices apply across 2026. From January 1, 2027, the Commission switches to publishing a price every Monday instead, tracking the EU ETS market in something close to real time.

That date isn’t the same as when certificates go on sale though. Purchases open a month later, on February 1, 2027, and cover all of 2026’s imports retroactively. Nobody pays for 2026 emissions until then, which gives importers most of a year to model their exposure before a euro changes hands.

Two systems, one compliance trail

Buying a certificate and staying compliant run through two different pieces of infrastructure. The CBAM Registry is where declarants submit their annual declarations and where certificates are issued, held, surrendered, and cancelled. Payment is processed separately, through a Common Central Platform the Commission built to handle the financial side. Declarants can buy certificates in any quantity, as often as they like, throughout the year: there’s no cap and no single annual purchase window to wait for.

That flexibility has a limit. From 2027, declarants must hold certificates covering at least 50% of their year-to-date embedded emissions at the end of each quarter, a threshold the Commission cut from 80% to ease cash flow. Imports are tracked on the calendar year, January 1 through December 31, and every holding requirement resets on that clock.

The deadlines that actually bind

Three dates govern a certificate’s life, and none of them fall within the year the certificates cover: both the surrender and repurchase happens in the subsequent year, whilst the expiry of certificates happens 2 years after.

September 30, annually: the deadline to submit the annual declaration and surrender enough certificates to cover the full prior year’s emissions. Miss it, and the penalty is EUR 100 per tonne of the shortfall.

October 31, annually: the deadline to request repurchase of any surplus. The request can only be filed once a year, cannot be edited or withdrawn after submission, and is repaid at exactly the price the certificate was bought for.

November 1, annually: whatever is left uncancelled and unsurrendered from certificates bought two calendar years earlier disappears, with no compensation.

None of this can be worked around by trading. CBAM certificates are non-tradable and non-transferable, so the one-shot repurchase window above is the only way to unwind a surplus.

Who’s exempt

Importers whose combined imports of cement, iron and steel, aluminium, and fertilizers stay at or below 50 tonnes of net mass in a calendar year are exempt from CBAM altogether: no registration, no declaration, no certificate surrender. Electricity and hydrogen carry no such exemption.

The two fights that will set the real price

CBAM’s actual bite depends on two negotiations still running in Brussels, and they’re not the same fight.

The first is timing. CBAM is meant to replace the free EU ETS allowances domestic producers currently receive, phasing them out between 2026 and 2034 as CBAM’s own cost factor climbs from 2.5% to 100%. Germany and Austria are both pushing to stretch that phase-out past 2034, which would leave domestic producers with free allowances for longer and push back the point at which CBAM’s full cost lands on importers.

The second is scope. CBAM currently taxes raw materials, not the finished goods made from them, and the Commission’s own reading is that this leaves a downstream leak: a fridge or an engine built from steel carries no carbon charge at all today. The Commission’s December 2025 proposal would add 180 downstream products to close that gap. The Council’s position, adopted in June 2026, pushes that closer to 380. Parliament’s environment committee voted in July for more than 400. That fight runs through the ordinary legislative process, with Parliament and Council negotiating toward a final number. It has nothing to do with the separate delegated act that governs how certificates are bought and sold, whose public consultation closed as of August 6 and now awaits adoption. The two are easy to conflate; only one of them changes what gets taxed.

Both fights are still open as of August 2026. Either outcome will matter more to an importer’s actual bill than any single quarterly price print.