How CBAM Embedded Carbon Benchmarks Are Calculated for Steel, Aluminium and Cement
The CBAM benchmark is the default emission value applied to your product when actual verified values are not available. Understanding how benchmarks are calculated helps you assess whether documenting actual values is financially worthwhile.
The 90th Percentile Methodology
CBAM benchmarks are calculated using the 90th percentile of EU production emissions for each product category. This means the benchmark represents the emission intensity of the 10% least efficient EU producers. 90% of EU producers emit less than the benchmark. The EU Commission chose the 90th percentile to ensure that non-EU producers who do not document actual values pay at least as much as the least efficient EU producers — preventing a competitive advantage from avoiding carbon costs.
Benchmark Calculation: Steel Example
The EU Commission collected production data from all EU steel producers. For each tonne of steel produced, the direct and indirect emissions were calculated. These values were ranked from lowest to highest. The value at the 90th percentile — the point where 90% of production has lower emissions — became the benchmark of 2.18 tCO2/t.
Sector Benchmarks and Measurement Against Actual Values
| Sector | Benchmark (tCO2/t) | Measurement methodology | Implementing Regulation reference |
|---|---|---|---|
| Steel (all products) | 2.18 | Direct + indirect (Scope 1 + 2) per tonne of product | Annex III, Section 1 |
| Aluminium (primary) | 12.40 | Direct + indirect (electricity-intensive) per tonne | Annex III, Section 2 |
| Cement (clinker) | 0.766 | Direct emissions per tonne of clinker | Annex III, Section 3 |
| Ammonia | 2.326 | Direct + indirect per tonne of ammonia | Annex III, Section 4 |
| Urea | 0.467 | Direct + indirect per tonne of urea | Annex III, Section 4 |
| Nitric acid | 6.844 | Direct (N2O) + indirect per tonne | Annex III, Section 4 |
| Hydrogen | 5.14 | Direct + indirect per tonne of hydrogen | Annex III, Section 5 |
How Actual Values Are Measured Against Benchmarks
When an ISO 14065 accredited verifier calculates your actual embedded carbon, the result is compared to the benchmark. If your actual value is below the benchmark, you pay CBAM certificates based on your actual value — not the benchmark. If your actual value is above the benchmark, you may choose to use the benchmark value instead (it would be lower). The financial saving from documenting actual values is: (Benchmark − Actual) × Production volume × ETS price.
Frequently Asked Questions
What is the 90th percentile methodology for CBAM benchmarks?
CBAM benchmarks are set at the 90th percentile of EU production emissions. This means 90% of EU producers emit less than the benchmark. Non-EU producers with actual emissions below the benchmark benefit from documenting actual values.
Where are CBAM benchmark values published?
CBAM benchmark values are published in CBAM Implementing Regulation 2023/1570 Annex III, available in the Official Journal of the European Union.
Can CBAM benchmarks change?
Yes. The EU Commission reviews benchmark values periodically and may update them as EU production data changes. Monitor the CBAM Implementing Regulation for updates.
Does the benchmark apply to all products in a sector equally?
No. Within sectors, different products may have different benchmarks. For example, within fertilisers, ammonia (2.326 tCO2/t) and nitric acid (6.844 tCO2/t) have very different benchmarks reflecting their different production processes.
What is the benchmark for green hydrogen?
The CBAM benchmark for hydrogen is 5.14 tCO2/t. Green hydrogen produced via electrolysis using renewable electricity can achieve near-zero actual emissions — saving EUR 336.26/t vs the benchmark at current ETS prices.
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