EU CBAM for Indian steel and aluminium exporters: what your buyers will ask for

What changed on 1 January 2026

The EU's Carbon Border Adjustment Mechanism (CBAM) ran a transitional phase from October 2023 to the end of 2025, when importers only had to report. The definitive period began on 1 January 2026. Importers now declare the quantity and embedded emissions of covered goods each year and surrender CBAM certificates to cover them. Certificates for goods imported in 2026 go on sale in February 2027.

The certificate price follows the EU Emissions Trading System, less any carbon price already paid in the country of production. The covered sectors are iron and steel, aluminium, cement, fertilisers, hydrogen and electricity.

Scope is set by Combined Nomenclature (CN) code, not by industry. Downstream products such as tubes, sheets, wire, screws, bolts, bars, foil and structures can be in scope because they are mainly made of a covered material. Check every code you export against Annex I of the CBAM Regulation, using the Commission's tools or the EU's TARIC tariff database.

In December 2025 the European Commission proposed extending CBAM to more downstream steel and aluminium products from 2028. That is a proposal and may change, so check its status before planning around it.

Why your buyer's cost depends on your data

An importer can declare emissions using actual data from the installation that made the goods, or default values published by the Commission. Defaults are set cautiously, so that producers have a reason to supply real data, and they usually cost the importer more.

Buyers build that cost into what they will pay, or into which supplier they choose. So emissions data is now part of your price. An exporter with measured, verified figures can offer a lower landed cost than a rival whose customer has to fall back on defaults.

How embedded emissions are worked out

Embedded emissions are calculated for each installation and each product, using the method in the CBAM rules and their implementing acts.

• Direct emissions come from fuel and processes in the installation, including heat. They are required for all covered goods. For some aluminium goods they include perfluorocarbons (PFCs) released in smelting.
• Indirect emissions come from the electricity used in production. The EU currently counts them only for cement and fertilisers, not for steel or aluminium. Keep the electricity data anyway, because other buyers and schemes ask for it.

Simple goods are made from inputs with no embedded emissions of their own under CBAM. Complex goods use covered materials as inputs, called precursors, such as steel slab rolled into pipe. For a complex good you add the precursors' embedded emissions, which means you need data from your own suppliers too.

What actual data needs, and who checks it

• A defined installation boundary and the production processes inside it.
• Fuel, electricity, heat and material inputs measured over the reporting period.
• Production quantities by product.
• Precursor data from your own suppliers, for complex goods.
• A written monitoring method a verifier can follow.

Actual emissions used in EU CBAM declarations must be verified by an accredited verifier. Plan for that from the start: keep data, calculations and evidence in a form a verifier can follow, and expect a site visit.

Where industrial heat and the grid are coal-heavy, your actual figure may still be high. Defaults are country averages with a mark-up added that rises each year to 2028, though, so installation data usually gives a lower and more defensible number. Check the Commission's current defaults for your products before you estimate your customer's cost.

The Commission's CBAM Registry has an operator portal where producers outside the EU can register installations and their embedded emissions, then choose which importers can see them. You report once, and sensitive data stays between you and the authorities.

What to do this year

• Check every exported CN code against CBAM scope, and list the EU customers buying in-scope goods.
• Define your installation boundary and meter fuel, electricity and heat by process where you can.
• Record production by product, month by month.
• Ask precursor suppliers for their embedded emissions.
• Calculate embedded emissions with the method written down, then line up a verifier.
• Tell customers what data to expect and when, and share provisional figures with the method shown.
• Identify and cost reductions: efficient furnaces, fuel switching, scrap-based routes, renewable electricity.

The same records do other jobs. They answer value chain questions from listed Indian customers under BRSR Core, and prepare you for India's Carbon Credit Trading Scheme where it applies. Cluster associations and energy management centres can share monitoring methods and verifier contacts, which can lower the cost for each unit.

If you also sell to Britain, the UK runs its own CBAM from 1 January 2027. It covers aluminium, cement, fertiliser, hydrogen, and iron and steel, for UK importers bringing in £50,000 or more of in-scope goods in 12 months. The same installation data serves both.

How ESGen helps with CBAM

CBAM readiness is a team service at ESGen, scoped with you, not a platform feature. Our team can work out installation-level embedded emissions for in-scope goods, collect precursor data from your suppliers, and organise the evidence a verifier will ask for. The platform's BRSR lens holds the same energy figures, with the bill behind each, for your listed Indian customers.

We do not verify emissions, file CBAM declarations or act as your importer's declarant. Accredited verifiers and your customers do those parts, and CBAM rules are still changing through implementing acts, so confirm your position before acting. Read more about CBAM support, or book a demo and bring a list of the CN codes you export.