CBAM and the UAE: How Gulf Aluminium Exporters Are Affected
The UAE is one of the world's largest aluminium producers through Emirates Global Aluminium (EGA), operating EMAL and DUBAL. UAE primary aluminium using natural gas-powered electricity achieves actual embedded carbon of 8–10 tCO2/t — saving EUR 157–288/t vs the 12.40 default.
UAE CBAM Exposure
| Company | Sector | Actual (tCO2/t) | Saving vs default | Annual saving on 500,000t |
|---|---|---|---|---|
| EGA (EMAL + DUBAL) | Primary aluminium | 8.00–10.00 | EUR 157–288/t | EUR 78–144M |
| Emirates Steel Arkan | Steel (EAF + DRI) | 0.50–0.80 | EUR 89–110/t | EUR 89–110M per 1,000,000t |
UAE as an Aluminium Re-Export Hub
The UAE also serves as a re-export hub for aluminium from other Gulf producers. Aluminium from Bahrain (Alba — ALBA smelter) and Qatar (QATALUM) may transit through UAE ports before export to the EU. CBAM applies to the country of origin of the aluminium — not the country of export. UAE-origin aluminium (EGA/EMAL/DUBAL) and Bahrain-origin aluminium (Alba) have different embedded carbon values and must be documented separately.
Barakah Nuclear: Reducing UAE Grid Factor
The UAE's Barakah nuclear power plant (4 units, total capacity 5.6 GW) became fully operational in 2024. As Barakah's contribution to the UAE grid increases, the grid emission factor will decrease from the current ~0.40 tCO2/MWh. This will further reduce the actual embedded carbon of UAE EAF steel and aluminium over time.
Sector-specific deep dives for UAE
UAE's CBAM Exposure at a Glance
The UAE's primary CBAM exposure is aluminium, with Emirates Global Aluminium (EGA) being one of the world's largest primary aluminium producers. EGA operates two smelters — Jebel Ali (Dubai) and Al Taweelah (Abu Dhabi) — with a combined annual production capacity of approximately 2.6 million tonnes. The UAE is also developing significant green and blue hydrogen capacity, which will create future CBAM exposure as hydrogen exports to the EU grow.
Sector-by-Sector Breakdown
Aluminium: EGA's smelters are powered by natural gas, with the Al Taweelah smelter using captive gas-fired power generation. The UAE grid emission factor for natural gas is approximately 0.45 tCO₂/MWh, giving EGA a mid-range embedded carbon intensity of approximately 8–10 tCO₂/t — below the EU default of 12.40 tCO₂/t. EGA has also been investing in solar PPA integration at Al Taweelah, which could further reduce embedded carbon. Documenting actual values could save approximately EUR 200–350 per tonne at current ETS prices. See UAE aluminium CBAM deep dive →
Hydrogen: ADNOC (Abu Dhabi National Oil Company) and Masdar are developing large-scale blue and green hydrogen projects targeting EU export markets. NEOM's Helios project (green hydrogen via solar electrolysis) and ADNOC's blue hydrogen (SMR with CCS) projects are both designed with CBAM compliance in mind. Green hydrogen from renewable electrolysis can achieve near-zero embedded carbon, well below the EU default of 5.28 tCO₂/t.
Steel: The UAE has limited primary steel production. Emirates Steel (now part of EMSTEEL) operates an EAF-based facility in Abu Dhabi. EAF steel with UAE natural gas grid achieves approximately 0.5–0.8 tCO₂/t — well below the EU default of 2.18 tCO₂/t.
Domestic Carbon Pricing Context
The UAE does not currently have a national carbon price eligible for CBAM Article 9 deductions. The UAE has committed to net-zero by 2050 and is developing voluntary carbon market infrastructure, but a mandatory ETS covering industrial sectors is not yet in place.
How UAE Producers Should Prepare
UAE producers should engage internationally recognised ISO 14065 accredited verification bodies with UAE operations. Bureau Veritas UAE, SGS UAE, DNV UAE, and TÜV Rheinland UAE all offer CBAM verification services. EGA should prioritise actual-value documentation for its aluminium production, particularly for the Al Taweelah smelter where solar PPA integration can be documented as a renewable electricity source.
Find accredited verifiers: UAE CBAM Verifier Directory →
Frequently Asked Questions
What is the CBAM exposure for UAE aluminium?
UAE's EGA produces approximately 2.6 million tonnes of aluminium annually. Using natural gas-powered electricity (grid factor ~0.40 tCO2/MWh), UAE primary aluminium achieves actual embedded carbon of 8–10 tCO2/t vs the 12.40 default — saving EUR 157–288/t.
Does the UAE have a carbon price eligible for CBAM deduction?
No. The UAE does not have a national carbon tax or ETS eligible for CBAM deduction. UAE manufacturers pay the full CBAM certificate cost with no deduction.
Does CBAM apply to Bahrain aluminium exported via UAE ports?
CBAM applies to the country of origin — not the country of export. Bahrain-origin aluminium (Alba) exported via UAE ports is treated as Bahrain-origin for CBAM purposes.
What is UAE's grid emission factor for CBAM?
UAE's grid emission factor is approximately 0.40 tCO2/MWh. The Barakah nuclear plant is gradually reducing this factor as it reaches full capacity.
Where can UAE manufacturers find ISO 14065 accredited CBAM verifiers?
See the UAE verifier directory at /verification-directory/uae/ for ESMA ISO 14065 accredited CBAM verification firms.
Calculate your CBAM saving → · Find a verifier → · What is embedded carbon? →