CBAM default values vs verified data: which costs less?
When the EU CBAM entered its definitive phase in January 2026, it created a choice that every importer of covered goods will face — and many are underestimating.
The choice is this: pay your CBAM liability based on the European Commission's published default values for embedded emissions in your goods, or invest in obtaining verified actual emissions data from your overseas suppliers and pay based on that instead.
On the surface, using default values sounds like the path of least resistance. They are publicly available, require no supplier engagement, and avoid the cost and complexity of third-party verification. In practice, for the majority of importers, they are significantly more expensive than the alternative — and the gap is growing.
How default values work
Default values are the European Commission's published estimates of the embedded greenhouse gas emissions intensity for each category of CBAM good. They represent a worst-case scenario rather than an average — set at the highest emission intensity observed among countries with reliable data for each product type, or based on applicable region-specific values.
In late 2025, the Commission published revised default values and benchmarks as part of its implementing legislation package. For steel, aluminium, and iron, embedded emissions from precursor goods are now counted by default, while emissions from finishing processes are excluded in alignment with EU ETS rules.
The effect is straightforward: if you import a tonne of steel and use default values, your CBAM liability is calculated against a higher emissions figure than probably reflects the actual carbon intensity of your specific supplier's production. You are paying for a worst-case global emissions profile, not your supplier's actual performance.
The financial stakes
CBAM certificate prices are linked to the EU ETS allowance price, which rose sharply through 2025 and is expected to continue rising as the definitive phase drives greater demand. At ETS prices in the range of €50–70 per tonne — which was relevant for much of 2025 — the difference between default and actual emissions data for a mid-sized steel importer can amount to tens or hundreds of thousands of pounds per year in additional CBAM liability.
For the EU CBAM, the financial liability materialises from February 2027, when certificate purchases begin. But the embedded emissions data being used to calculate that liability relates to goods imported throughout 2026. Every import made this year is accumulating a CBAM obligation — and the data quality underpinning those calculations is being determined now.
For the UK CBAM, which takes effect from 1 January 2027, the same dynamic will apply from day one. CBAM rates are calculated quarterly, and the embedded emissions figure in your annual CBAM tax return determines your total liability for the year.
What verified actual data requires
To use actual emissions data in CBAM declarations rather than defaults, that data must be verified by an accredited third-party verifier. The verification process has specific requirements that businesses should understand before committing to this path.
Third-party accreditation
Verifiers must be accredited by a recognised national accreditation body. The pool of accredited CBAM verifiers is limited and is facing capacity constraints as demand grows. Early engagement with a verifier is strongly advisable.
On-site audit in the first year
For the first verification of a given installation, verifiers must conduct an on-site audit at the facility where the goods are produced. This means engaging your overseas suppliers to allow a verifier physical access to their operations — a requirement that demands advance planning and strong supplier relationships.
Data methodology review
Verifiers assess not just the emissions figures themselves, but the methodology used to collect them —including system boundaries, precursor emissions accounting, and production route allocations. Figures that appear plausible may still fail verification if the underlying methodology is not robust and well-documented.
Five percent materiality threshold
Verifiers apply a 5% materiality threshold to the data they assess. If verification fails — or if it is not completed before your declaration deadline — you revert to default values for that supplier's goods. The cost advantage you were working toward disappears at precisely the moment financial liability begins.
Carbon Price Relief: another reason to get supplier data right
Both the EU CBAM and the forthcoming UK CBAM include provisions for Carbon Price Relief — a mechanism allowing importers to deduct carbon costs already paid by their overseas supplier in their country of production, from their total CBAM liability.
For importers sourcing from countries with established carbon pricing mechanisms, this can be a meaningful reduction in total cost. But to claim it, you need accurate, documented evidence of the carbon price paid in the third country, along with the methodology for calculating it.
This is another area where supplier relationships and data quality directly translate into financial outcome. The more you understand your supply chain's carbon position, the more levers you have to manage your CBAM exposure.
The supplier engagement challenge
For most UK importers, the hardest part of obtaining actual emissions data is not the verification process itself— it is getting overseas suppliers to engage with the request in the first place.
Many non-EU, non-UK manufacturers— particularly in markets such as Turkey, India, or China — have not historically been required to measure or report embedded emissions at the installation level. They may lack the internal data, the expertise, or the commercial motivation to invest in generating it.
This creates a real competitive dynamic. Importers who build strong supplier relationships and invest in supporting their overseas partners through the data collection process will be able to use actual emissions data — and gain the cost advantage that brings. Those who cannot secure supplier engagement will default to published defaults, with no visibility or control over their CBAM liability.
The supplier engagement process takes time. It involves:
• Communicating what data is required and in what format
• Supporting suppliers in establishing internal measurement processes if they do not already exist
• Managing data collection on an ongoing basis across multiple suppliers and product categories
• Coordinating third-party verification across potentially complex, multi-country supply chains
This is not a process that can be started six weeks before a declaration deadline. It needs to be underway now, for liabilities that are already accruing.
Practical steps for importers
Whether your first CBAM obligation relates to the EU (2026 imports, declaration due September 2027) or the UK(imports from January 2027), the preparation process is the same. The time to act is now.
Map your exposure by product and supplier
Identify which goods fall within CBAM scope, which suppliers produce them, and what you know about the carbon intensity of their production processes. For most importers, a clear picture of exposure is the single most valuable thing to establish first.
Calculate the default value cost
Look up the Commission's published default values for your product categories and calculate what your approximate CBAM liability would be if you relied entirely on defaults. This gives you a financial baseline to compare against the cost of obtaining verified data — and often makes the case for verification very clearly.
Prioritise your highest-volume, highest-risk suppliers
You do not need to start verified data collection across your entire supply chain simultaneously. Focus first on the suppliers responsible for your highest CBAM cost exposure. A Pareto analysis of suppliers by volume and estimated embedded emissions typically reveals that a small number of suppliers account for the majority of your CBAM risk.
Open supplier conversations now
Explain what CBAM requires, what data you need, and why it is in both parties' commercial interest to get it right. Consider incorporating CBAM data obligations into your supplier contracts going forward — this creates clarity, accountability, and a documented basis for the data you rely upon.
Identify accredited verifiers and book early
Verification capacity is limited. Identify suitable accredited verifiers, understand their timelines and costs, and begin the engagement process before demand peaks. For overseas installations requiring on-site audits, logistics and scheduling add significant lead time.