CBAM for Aluminium Exporters: Embedded Emissions, Scope 2, and What to Prepare

Of all the CBAM-covered sectors, aluminium has the most divergent emission profiles globally — primary aluminium from China's coal grid can carry 16 tCO₂e per tonne, while the same metal from an Icelandic hydro smelter emits under 2 tCO₂e/t. That spread means CBAM's financial impact on different exporters varies by an order of magnitude. Getting your embedded emission calculation right is therefore not just a compliance exercise — it is a competitive and commercial matter.

What aluminium products are covered

CBAM covers aluminium products listed in Annex I of EU Regulation 2023/956, primarily under CN chapter 76. Key product groups include:

• 7601: Unwrought aluminium (primary ingots, secondary remelt ingots, billets)
• 7603–7606: Powder, paste, bars, rods, profiles, wire, plates, sheets, strip
• 7608: Aluminium tubes and pipes
• 7610: Aluminium structures and structural sections
• 7616: Other aluminium articles (brackets, fittings, hardware)

Use our free CBAM Applicability Checker to verify whether a specific CN code falls within CBAM scope, and see our broader guide on what CBAM is and how it works for the sector overview.

The embedded emission calculation framework

CBAM uses the concept of embedded emissions — the total greenhouse gas emissions generated during the production of the goods, within the defined installation boundary. For aluminium, the Commission's implementing regulation (EU 2023/1773) distinguishes between simple goods (one production step) and complex goods (goods that use other CBAM-covered goods as inputs).

Primary aluminium (electrolytic route)

Primary aluminium is produced via the Hall–Héroult electrolytic reduction of alumina. Embedded emissions have two components:

1. Direct (Scope 1) emissions: Anode consumption (carbon anode oxidation during electrolysis produces CO₂), perfluorocarbon (PFC) emissions from anode effects, and any on-site fossil fuel combustion for heat. Typically 1.5–2.5 tCO₂e/t of aluminium.
2. Indirect (Scope 2) emissions: Electricity consumed during electrolysis, converted using the applicable grid emission factor. This is by far the larger component — typically 13,500–15,000 kWh per tonne of primary aluminium. At China's average grid factor of ~0.85 tCO₂e/MWh, this alone yields ~12–13 tCO₂e/t of indirect emissions.

The CBAM formula: EE = SE₁ + (kWh/t × EF_grid) where EE = total embedded emissions per tonne, SE₁ = direct Scope 1 emissions per tonne, and EF_grid = the applicable electricity grid emission factor (tCO₂e/MWh).

Secondary aluminium (remelting route)

Secondary aluminium produced from recycled scrap has dramatically lower embedded emissions because it bypasses the energy-intensive electrolysis step. The main emission sources for secondary aluminium are:

• Energy for remelting furnaces (typically gas- or oil-fired) — 0.2–0.5 tCO₂e/t
• Electricity for casting, rolling, and finishing — typically 0.1–0.2 tCO₂e/t indirect
• Total: typically 0.5–1.5 tCO₂e/t, compared to 6–16 tCO₂e/t for primary

Importantly, the embedded emissions of the aluminium scrap input are treated as zero under CBAM methodology — consistent with GHG Protocol recycled content guidance. The calculation boundary begins at the remelting stage, not the upstream life cycle of the scrap.

Downstream products and precursor rules

For CBAM-covered downstream products (extrusions, rolled sheet, fabricated articles under CN 7610 or 7616), the embedded emissions must include the precursor embedded emissions — that is, the emissions embedded in the input aluminium that was used to produce the final product. This is the complex goods pathway:

Total EE (downstream) = EE of input aluminium per tonne × input quantity + direct emissions during downstream processing

The processing step emissions (extrusion, rolling, anodising, casting) are typically small relative to the upstream aluminium smelting emissions — but they must still be included and documented.

Grid emission factors: why your location matters enormously

What your EU importer needs from you

The CBAM obligation sits with the EU importer — they purchase the certificates — but they cannot fulfil it without verified emission data from the exporting producer. If you are a non-EU aluminium producer, you need to provide your EU customers with a producer data package for each shipment:

1. Installation identification: Name, location, operator, and production unit identifier
2. Specific embedded emissions (tCO₂e/t): Broken down into direct and indirect components
3. Methodology statement: Which monitoring methodology was used (Commission default, actual data per Commission methodology, or accredited verification)
4. Electricity data: Actual kWh consumed per tonne and the applicable grid emission factor used
5. Production period: The quarter to which the data applies (CBAM data must be quarterly or better)

Producers who cannot provide actual data will have default values applied by the EU Commission. Default values are intentionally set at the high end of the range for each country to create an incentive for actual data collection. For most aluminium exporters, using actual data rather than defaults substantially reduces CBAM liability.

Key CBAM dates for aluminium exporters

• 1 January 2026: CBAM definitive period began — EU importers now need CBAM certificates, not just quarterly reports
• 30 June 2026: Installation boundary registration deadline — producers who want to submit actual data must have registered their installation with the Commission's CBAM Registry
• 31 January 2027: EU importers submit their 2026 annual CBAM declaration
• 31 May 2027: Deadline to surrender CBAM certificates for 2026 imports