Energy Transition, Carbon, Emissions, Hydrogen
September 10, 2025
EU parliament backs CBAM overhaul to boost region's industrial competitiveness
HIGHLIGHTS
New 50-mt threshold exempts 90% of importers from CBAM rules
Lawmakers back simplification with 617 votes in favor of changes
CBAM certificate purchases delayed until February 2027
European lawmakers cleared the path for major changes to the EU's Carbon Border Adjustment Mechanism on Sept. 10, exempting 90% of importers from compliance and administrative requirements in a bid to improve the bloc's industrial competitiveness.
The simplification measures, part of the European Commission's Omnibus package presented in February 2025, passed with 617 votes in favor, 18 against and 19 abstentions.
The text still has to be officially endorsed by the European Council, and the simplified CBAM legislation will enter into force three days after publication in the EU Official Journal.
"We have answered calls from companies to simplify and streamline the process and exempted 90% of importers of CBAM goods to facilitate competitiveness and growth for our businesses," Antonio Decaro, a member of the European Parliament, who is the chair of the Committee on the Environment, Climate Change and Food Safety, said.
"As the CBAM will still cover 99% of total CO2 emissions, we have maintained the EU's environmental ambitions and remain fully committed to a just transition and to achieving climate neutrality by 2050," he added.
Tweaking CBAM
Under the new framework, imports of iron and steel, aluminum, cement, hydrogen and fertilizers below the 50-mt annual threshold per importer will be exempt from CBAM reporting and financial obligations.
Under the changes, importers will also be able to purchase CBAM certificates starting in February 2027 rather than from Jan. 1, 2026, to cover the emissions embedded in their imports for 2026, giving businesses more time to adapt to the new carbon pricing mechanism.
The aim of CBAM is to level the playing field for EU companies, as most exporting countries either do not have a carbon price as high as that of the EU Emissions Trading System or do not have a price on emissions altogether.
Carbon permits in Europe are currently around ten times more expensive than compliance prices in China, the world's industrial powerhouse.
Platts, part of S&P Global Energy, assessed EU Allowances for December 2025 at Eur76.88/mtCO2e ($90.13/mtCO2e) Sept. 9. This compares with China's compliance emission allowance, or CEA, which was valued at Yuan 66.18/mtCO2e ($9.31/mtCO2e) Sept. 5, according to the Shanghai Environment and Energy Exchange.
