The difference between Default Values, Minimum Compliance LEvels and High-Quality Onsite Data

3 Ways to Estimate Carbon Emissions for CBAM

EU Default Values:
Used when no other data is available. These are based on worst-case, high-emission scenarios (e.g., coal-based steel production). Easy but costly — often overestimates emissions and increases CBAM payments. After CBAM goes live, only 20% of reported emissions can use defaults.

Tier 1 Supplier + Regional Averages:
Use actual emissions data from your direct (tier 1) suppliers and apply regional emissions factors to precursor materials (e.g., Chinese steel averages). More accurate than default values, but still lacks supplier-specific precision.

High-Quality On-Site Data (Recommended):
Gather detailed, facility-level emissions data from both your suppliers and their upstream (precursor) suppliers. Localize emissions factors based on specific energy grids or regions (e.g., steel made in Shanghai, not just “China”). This offers the highest accuracy, enables smart supplier selection, and reduces CBAM costs.

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