CarbonChain has prepared a simplified data collection template in order to reduce the complexity of preparing your Summary Communication Sheet, which your customers require to meet their EU CBAM reporting obligations.
Please note, this simplified template is applicable for iron, steel and aluminium complex goods manufacturers. For producers of other CBAM goods, please review these guidance articles.
Process to obtain your Summary Communication Sheet
Complete the simplified data template and upload into your customer's data request email, following the steps outlined below. Alternatively, please deliver this back to CarbonChain, via support@carbonchain.com.
CarbonChain will convert this simplified file into the EU's Summary Communication Sheet and return it to you.
Use the CarbonChain platform to request data from your precursor suppliers in order to reduce the % of default values used in your CBAM installation data file.
Share your Summary Communication Sheet with your customers to enable them to meet their EU CBAM declaration obligations.
The simplified EU CBAM installation template can be downlaoded at the end of this article.
Key considerations for your CBAM emissions calculations
You are only in-scope of EU CBAM if you produce goods that fall under an in-scope CBAM tariff code. Please review this list in order to assess this first and foremost.
Reporting is done at the installation-level (e.g. a unique manufacturing site) for a given reporting period (e.g. calendar year 2023) capturing all relevant CBAM goods manufactured in that given production period.
CBAM reporting is done on a tariff-code basis, not an individual product specification basis. If you produce 100 different fasteners that are all classified under the same 73181542 code, you should aggregate all production into one product line.
Keep your reporting approach as simple as possible and aggregate goods into similar production processes for reporting purposes. If you do not measure fuel consumption (electricity or natural gas) at a machine-level, then only define one production process and CarbonChain will apportion emissions on a produced-volume basis.
Your CBAM installation data file reflects the carbon intensity of your CBAM goods produced over your defined reporting period and can be shared with any customer requesting this data. The file shared with your customers is customer agnostic and only contains an emissions intensity figure that they use for their CBAM reporting. No information pertaining to production volumes are provided to your customers.
Once shared with a customer, an accurate CBAM installation data file is valid for 12-months and does not need to be delivered to customers alongside every order.
If you fail to request and obtain data from your precursor suppliers, you will likely have a non-compliant CBAM installation data file as the share of default values in your calculation will exceed 20%. This is because the majority of the embedded emissions in your products are in your precursors (e.g. from the emissions produced by the mill or smelter to produce the crude steel or primary aluminium material).
The carbon accounting boundary for EU CBAM is different to traditional GHG Protocol carbon accounting as it is looking to emulate the EU's Emissions Trading System boundary. As a result, in most cases the only relevant emissions for complex goods manufacturing are associated with embedded emissions within in-scope precursors, electricity consumption and fuel consumption associated with static machinery found at the installation (e.g. forklift fuel consumption is out of scope).
Preparing your simplified EU CBAM installation template
Any questions preparing your data, please use the chatbot on the right of your screen or contact support@carbonchain.com.
Site_information
This tab contains relevant information on your site such as location, contact information and the reporting period.
To find your UNLOCODE please use this resource.
Defining your reporting period
We highly recommend reporting on a 12-month basis. This ensures that the emissions intensities of your products are average out to accounts for fluctuations in production volumes. You can also leverage other data sources that are likely already aggregated on a 12-month basis such as electricity and fuel consumption.
Production
This tab contains relevant information on the volume of CBAM goods that you have produced in a given reporting period (as defined earlier).
Product name & Commodity Code
As discussed above, CBAM reporting is at the tariff-code level - not at the product name level. Your "Product Name" should reflect a tariff-code aggregation of the CBAM goods that you produce on your site, per 8-digit commodity code (CN-code).
Please review this list in order to assess your in-scope commodity codes. The full list of CN Names and Codes can be found at the end of this article.
More information in-scope commodity codes:
More information in-scope commodity codes:
In order to find the CN code of your goods you can:
Talk to your trade compliance team;
Review box 33 of a customs declaration you have for those goods entering the EU;
Review your UK export records to the EU.
Production volume
Production volume relates to the total volume of production, regardless of whether or not the goods where send to the EU or not. Please note, you will have to make this differentation in advance of data verification however, at this time it is not required to calculate the embedded emissions of your CBAM goods.
Production route (or process)
The production route is used to define variations in the routes that your CBAM goods take through your site where products may have varying emissions profiles.
For example, if you produce 100 different fasteners of different specifications that are all classified under the same 73181542 code and all pass through a similar production route (e.g. all goods only undergo machining) then you are permitted to make an assumption that the electricity consumption by those static machines can be apportioned equally across the CBAM goods.
Where you clearly have multiple production processes on site, with relevant metered machines (e.g. a furance consuming natural gas or machines with significantly higher electricity consumption than other production routes) please define these specific production processes in this tab for the specific products that go through this process.
More information on production routes
More information on production routes
In subsequent tabs input_fuel and input_electricity you will be able to apportion the exact consumption of those relevant production processes and associated products.
If you do not measure fuel consumption (electricity or natural gas) at a machine-level, then only define one production process and CarbonChain will apportion emissions on a produced-volume basis.
If you have any questions on defining your production route(s) then please contact support@carbonchain.com
Precursors
This tab contains relevant information on the volume of CBAM precursors that you have purchased that go into the production process of your CBAM goods, and the relevant precursor supplier contact information.
Your in-scope precursors are the materials that you purchase that go into the CBAM goods that you manufacture. This is only the in-scope CN codes - please review this list in order to assess your in-scope commodity codes related to your precursors.
Firstly, how do I know if a precursor is a CBAM precursor?
Firstly, how do I know if a precursor is a CBAM precursor?
A precursor is in-scope of CBAM if the commodity code of that precursor is in scope of the CBAM regulation. Please review the list of in-scope CN codes from the EU, here.
Generally for iron and steel products, the crude steel material is in scope of CBAM (e.g. rods for fasteners). For aluminium products, the unformed aluminium is the in-scope precursor (e.g. billets for extrusion).
At this time, scrap material is considered to have zero embedded emissions and can be ignored for the purposes of CBAM calculations.
In the below graphics:
Green boxes imply that the embedded emissions must be accounted for in the calculation (i.e. these goods are in-scope precursors).
Red boxes imply that the embedded emissions in these precursors is zero. In this way, the embedded emissions in scrap are considered zero. Similarly, for fuels (e.g. coal, natural gas) there are no embedded emissions associated with obtaining these goods, only the emissions associated with their combustion.
Iron & steel produtcs
From the EU's guidance for installations:
Aluminium products
From the EU's guidance for installations:
Once you've identified your relevant in-scope precursors by commodity code and supplier name, please provide:
Precursor supplier contact information
Each CBAM precursor supplier will have a unique embedded emissions figure associated with the CBAM goods that they have manufactured that feed your production process. As a result, you must define precursors at the supplier-level.
Country of origin
The country of origin relates to the country of origin of the material. If you purchase from service centres or distributors, they must provide you information on the installation that produced the CBAM precursor. This will provide you with the relevant emissions information and country of origin of that material.
Commodity code & volume
The commodity code is used to confirm that the precursor is in-scope of EU CBAM. Where you do not have actual data from your suppliers, CarbonChain maps the default value associated with this commodity code and country of origin to populate your embedded emissions information for each precursor.
The volume pertians to the total volume of precursors consumed during the reporting period in order to produce the associated volume of your CBAM products. Your precursor volume is likely to always exceed your produced volume of CBAM goods. Waste material that is recycled in the production process can be assumed to be consumed as part of the original purchased precursor (i.e. do not double count in the precursor volumes).
Production process
As defined in your Production tab. Please assign each precursor a relevant production process that this precursor is consumed in. If you have defined multiple production processes, please breakdown the total volume per precursor associated with each production process.
Precursor embedded emissions
You need to request data from your precursor suppliers in order to inform your EU CBAM calculations. There's more information on how to use CarbonChain to support this process in the drop-down below.
Obtaining actual data from your precursor suppliers
Obtaining actual data from your precursor suppliers
The EU CBAM legislation permits complex goods producers to continue to use up to 20% default values in their calculations of the embedded emissions in their CBAM goods. What does this mean?
The embedded emissions calculations for a fastener include the upstream crude steel production, rod forming and subsequent processing into a fastener at your site. Greater than 90%, if not more, of the embedded emissions in the resulting fastener arise from the crude steel production process.
As a result, in order to meet the EU's 20% maximum threshold on default value usage, you need to get the CBAM installation data from the mill that produced the crude steel that you are consuming in your production process.
Prioritise your highest volume precursor suppliers in order to meet this 20% threshold as quickly as possible.
You must provide a precursor supplier name above and if you provide contact information then CarbonChain can enable you to request precursor data via our platform, enabling you to request and validate the data received. Your suppliers will also gain access to this reporting capability in order to prepare their own CBAM data. Further information on obtaining precursor emissions data from your suppliers below.
Alternatively, if you'd like to request data from your precursor suppliers independently, please find this letter template that you can use to send to your precursor suppliers that outlines their EU CBAM reporting obligations to you.
From your supplier, you should receive an EU CBAM installation data file in the form of an Excel file tab called "Summary Communication" that looks like this:
The yellow cell enables you to identify which CN codes are your relevant precursors (as defined above).
This information for each relevant precursor can then be entered into this section in the precursors tab:
Green = SEE (direct) [column K]
Purple = SEE (indirect) [column L]
Orange = Source for electricity EF [column N - fixed fields]
Blue = Embedded electricity (MWh/t) [column M]
Regarding the Source of EF column, these fields mean the following:
Regarding the Source of EF column, these fields mean the following:
D.4(a) - EF based on IEA data, provided by the European Commission
D.4(b) - EF based on other publicly available data representing either the average EF or the CO2 emission factor as in section 4.3 of Annex IV of the CBAM Regulation.
D.4.1 - EF of electricity produced in the installation other than by cogeneration
D.4.2- EF of electricity produced in the installation by cogeneration
D.4.3.1 - EF of electricity produced outside the installation (received from a source with a direct technical link)
D.4.3.2 - EF of electricity produced outside the installation (received from a producer under a power purchase agreement)
Mix - Where the electricity is not predominantly obtained from one source or the EF determined by more than one of the above sources, the EF is determined as a mix of the methods above.
As you receive this data over time, please update the template and return it to CarbonChain who will update your CBAM installation data file.
Input_fuel
This tab contains relevant information on the fuel consumed in the production of your CBAM goods that is directly related to machines involved in the production process.
If you do not have any furnaces or static machines directly related to the production of CBAM goods that combust fuels at your installation, please leave this tab blank and move on to the next tab.
Fuel consumption of non-static machinery (e.g. forklifts) or fuel consumed for space heating are not relevant for EU CBAM reporting. If you only have one meter for all natural gas and this captures both space heating and furance operations, please be prudent and include the full volume.
Input fuel
Only one input fuel is defined in this template: natural gas.
If you believe you have additional fuels that you are combusting in stationary-machinery that are relevant to the production process of your goods, please contact support@carbonchain.com.
Volume
This relates to the volume of fuel combusted on site over the defined reporting period. This data should be collected from a relevant meter or invoice.
Unit
The unit of fuel consumption must be provided as either Tonnes or Cubic Meters (1000 normal meters cubed).
Production process
As outlined earlier when defining the production processes on site, if you have specific production processes that consume natural gas and others that do not, please ensure to define the relevant in-scope production processes in this tab.
Input_electricity
This tab contains relevant information on the electricity consumed in the production of your CBAM goods that is directly related to machines involved in the production process. If you only have one meter for all electricity consumption on site (e.g. including office and non-production related consumption) then please be prudent and include the full electricity consumption figure.
Source of electricity
You have three options when defining the source of electricity you consume on site:
Received from grid
Power Purchase Agreement (PPA)
On-site generation
Please note, where electricity is sourced from the grid, CBAM is calculated on a location-based basis - i.e. the emissions factor used will either be a country or regional average.
Volume and units
The total volume of electricity consumed on site relevant to the production process, in MWh.
Production route
As outlined earlier when defining the production processes on site, if you have specific production processes that consume considerably more electricity in the production of certain goods, please ensure that you allocate the associated electricity consumption across each production process. This will ensure that allocation is performed accurately.
If you only have one meter for all electricity consumption on site then you should only define one production process and the electricity-related emissions will be apportioned across the goods on a production volume basis.
Emissions factor (if known), tCO2e/MWh
Where you have on-site generation or a PPA, please define the emission factor of generation - if known. If blank, CarbonChain will automatically populate a country-level emissions factor based on the location of the site as defined in site_information.
Process map
If you would like to provide a process map for system boundary review, please paste an image in the final tab. This will be used by CarbonChain to review the production routes that you have defined.
Have a simplified communication sheet and looking to convert it to the EU CBAM Summary Communication Sheet?
Please send it to support@carbonchain.com.