CBAM Aluminium: Should You Use Actual or Default Emission Values?

Actual vs Default Emissions: The Aluminium Decision

For South African aluminium producers, the choice between using EU default emission values and actual verified emissions for CBAM purposes is one of the most financially significant decisions they will make in 2026.

The Default Value Approach

The EU default emission value for aluminium is 12.4 tCO₂/t (including the 10% markup penalty for 2026, rising to 30% from 2028).

When to use default values:

• Your actual embedded emissions are higher than 12.4 tCO₂/t
• You don't have the systems in place to collect and verify actual emissions data
• The cost of verification exceeds the potential savings from lower actual emissions

For most South African aluminium smelters using Eskom grid electricity (actual emissions ~13.9 tCO₂/t), the default value approach results in lower CBAM liability than using actual emissions.

The Actual Emissions Approach

If you can demonstrate that your actual embedded emissions are below 12.4 tCO₂/t, you can reduce your CBAM liability by using verified actual emissions.

When actual emissions might be below the default:

• You have a significant renewable energy PPA in place
• You use on-site renewable generation (solar, wind)
• Your smelter has above-average energy efficiency
• You have access to lower-carbon electricity sources

Example: Smelter with 40% renewable PPA

• Grid electricity: 60% × 14 MWh/t × 0.95 tCO₂/MWh = 7.98 tCO₂/t
• Renewable electricity: 40% × 14 MWh/t × 0.02 tCO₂/MWh = 0.11 tCO₂/t
• Scope 1 (anode): 0.5 tCO₂/t
• Total actual: 8.59 tCO₂/t — well below the 12.4 default
• CBAM saving vs default: (12.4 - 8.59) × €65 = €247.65/t

At 100,000 tonnes of EU exports, this represents a saving of €24.8 million per year — a compelling business case for renewable energy investment.

The Verification Process

To use actual emissions, you must:

1. Implement an emissions monitoring system — metering electricity consumption, fuel consumption, and process emissions at production level
2. Calculate embedded emissions using the EU methodology in Implementing Regulation (EU) 2023/1773
3. Commission third-party verification by an accredited verifier (Bureau Veritas, SGS, TÜV Rheinland, DNV)
4. Provide verified data to your EU importer for their CBAM declaration

The verification cost is typically R200,000–R500,000 per year for a large smelter — a small fraction of the potential CBAM savings from lower actual emissions.

The Decision Framework

Use the CBAM Calculator [blocked] to model both scenarios for your specific situation.