Why default values are expensive

A CBAM default value is an assumption about how much carbon a tonne of product carries when the real figure is unknown. The Commission set one per product and country of origin, based on available emissions data for producers in that country, and then added a mark-up so that relying on it is never the cheapest option.

Three layers of cost

The first layer is the country average: an efficient mill in a high-emitting country is judged by the national figure. The second is the mark-up of 10 % in 2026, 20 % in 2027 and 30 % from 2028 (1 % for fertilisers). The third is the benchmark gap. The free allocation adjustment only covers emissions up to the EU benchmark, which reflects the best EU installations, so everything above it is paid in full.

Hot-rolled flat steel as an example

For flat-rolled steel (CN 7208) made through the blast furnace route, the default benchmark is 1.37 tCO₂e per tonne. Here are the 2026 default values (including the 10 % mark-up) for some major suppliers, and what they imply per tonne at €82.32:

The spread is enormous: the same product can carry a CBAM cost several times higher depending only on where it was made. A mill that actually emits around 2 tCO₂e per tonne would pay roughly €55 per tonne in 2026 with verified data.

Why ‘other countries’ is the worst case

Where a country is not listed, or a product shows no value in its table, the value for “other countries and territories” applies. It is set high on purpose. That makes the fallback matter for big suppliers too; see Türkiye’s cement.

Replacing the default

Verified actual data from the producing installation replaces the default entirely. Verification costs money and takes time, but at these prices it pays for itself on modest volumes. A checklist for producers explains the steps.