The United Kingdom’s Carbon Border Adjustment Mechanism will apply product-specific default emissions values for imported steel, aluminium, cement, fertilisers and hydrogen in 2027 and 2028. HM Revenue & Customs (HMRC) published a schedule on 16 October 2026 that sets the emissions intensities importers must use when eligible verified actual-emissions data are not available. The approach is designed to limit commercial advantage from avoiding verification of actual emissions.
Under the UK framework, the gap between a product’s prescribed default value and its verified emissions intensity can affect supplier selection and the pricing of industrial imports. This means the default-based benchmark can influence how offers are compared when verified data are not used.
Product-specific default benchmarks for covered industrial goods
The initial UK CBAM default values cover 2027 and 2028 and are derived from EU emissions data. The figures are adjusted to reflect the boundaries of the UK system, weighted according to the composition of British imports, and calculated excluding goods originating in the European Union. HMRC has applied a 10% markup across all covered sectors except fertilisers, for which no markup is applied.
The published default emissions intensities vary by product and establish different starting points for assessing emissions associated with imports. The values listed by HMRC include non-alloy aluminium slabs at 2.058 tCO2e/t, cement clinker at 1.433 tCO2e/t, and ordinary Portland cement at 1.375 tCO2e/t. The same schedule also lists anhydrous ammonia at 2.434 tCO2e/t, standard high-nitrogen urea at 1.392 tCO2e/t, and hydrogen at 28.378 tCO2e/t.
For individual imports, the applicable default value determines the emissions benchmark used when a default-based reporting route applies. This links the product-level figures in HMRC’s schedule to how carbon-related costs are calculated for imports where verified actual-emissions data cannot be used.
Steel defaults differentiated by CN code and production form
Steel defaults are not represented by a single figure for the whole sector. Instead, they are differentiated by Combined Nomenclature (CN) code and production form. This structure creates a range of default emissions intensities across different steel products.
As a result, two commercially substitutable steel products may face different default-based carbon-cost exposures depending on their classifications and applicable emissions values. The distinction is relevant when importers compare offers from suppliers whose actual production emissions may also differ.
The same installation-level comparison can apply beyond steel, including for aluminium producers. For fertiliser manufacturers and hydrogen producers, verification can also matter where verified emissions intensities fall below the relevant default benchmarks.
Verified actual emissions as a factor in commercial comparisons
The UK framework is intended to support use of verified actual-emissions data when producers can demonstrate lower carbon intensity than the applicable default value. For lower-emissions steel mills, aluminium smelters, fertiliser plants and hydrogen production facilities, verification can support both regulatory compliance and commercial differentiation.
The financial case for obtaining verified data depends on the product concerned, the installation’s emissions performance, and the volume exported to the UK. Producers and importers are expected to compare default-based carbon costs with costs associated with establishing and verifying actual emissions before deciding whether additional monitoring, reporting and verification (MRV) expenditure is justified.
The ability to substantiate emissions claims is also relevant to quotations and supply contracts. Supplier offers can be assessed not only against underlying steel, aluminium or fertiliser prices but also against carbon-related costs associated with importing into the UK.
HMRC limits changes after submission using actual-emissions evidence
HMRC states that a submitted UK CBAM return cannot be amended solely to replace a default value with actual-emissions data. Importers therefore need to obtain required emissions evidence early enough for it to support the return when submitted.
If monitoring and verification are not completed in time, producers may leave their UK customers reliant on default values even if installation-level data could later show lower emissions. This makes availability of verified information before reporting deadlines a direct commercial consideration.
Importers and exporters must coordinate emissions documentation and verification with reporting schedules rather than treating verification as a retrospective administrative step.
Planned country-specific defaults from 2029
The UK intends to introduce country-specific default values from 2029. The plan includes separate values for each covered CBAM good and each country, replacing the current method based on trade-weighted values derived from EU emissions data adjusted to UK system boundaries.
The change could affect relative exporter positions across national markets. Efficient production facilities in countries with higher average emissions could have stronger incentives to demonstrate their own actual emissions, while more carbon-intensive facilities could lose benefits linked to broader trade-weighted averages.
For exporters in Serbia, Turkey, India and other countries supplying UK industrial customers, assessments would involve calculating applicable default-based carbon costs, comparing them with costs linked to verified actual emissions, and evaluating whether potential savings justify MRV and independent verification expenses. The outcome depends on product type, installation-level emissions performance, and export volumes as implementation progresses.