The CBAM Simulator
Explore our simulator to see the impact — from estimated fees to trade and policy scenarios.
The CBAM Simulator was developed to help stakeholders — especially from non-EU countries — understand the potential implications of the EU Carbon Border Adjustment Mechanism (CBAM) and explore how different national strategies may influence outcomes.
It is not designed to forecast specific costs, but rather to provide a flexible, interactive environment where users can simulate scenarios, apply filters, and compare the effects of policy choices on trade flows and carbon-related costs.
All simulations are based on 2023 trade volumes, assuming these remain constant over time.
The Simulator is designed to illustrate possible evolutions of the CBAM and responses to it by third countries.
What assumptions does the simulator use?
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Trade volumes: Based on 2023 import data by product and partner country.
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EU carbon price: Aligned with the EU ETS benchmark (illustrative baseline, adjustable in the simulator).
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Non-EU carbon pricing: Scenario assumes exporter carbon prices equivalent to 25%, 50%, or 75% of the EU carbon price.
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Pass-through rate: EU producers are assumed to pass on 80% of their carbon costs to buyers.
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Exchange rates and trade values: Constant 2023 terms (no inflation or trade growth adjustments).
How can countries respond to CBAM?
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Business-as-Usual: No strategic adjustment by exporting country. The emissions intensity of goods sold to Europe is taken as the country’s average.
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Resource Shuffling: Exporters prioritise lower-carbon products for EU markets, such as:
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Steel goods made using electric arc furnaces (EAF) and higher contents of scrap.
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Aluminium goods made of higher contents of remelted scrap.
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Cement products with lower clinker content, and cement rather than clinker.
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Goods made using higher amounts of green electricity.
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Introduction of Carbon Pricing: Exporting country implements domestic carbon pricing at 25%, 50%, or 75% of the EUA price.
What possible scope extensions could the CBAM include next?
Scope extensions
- Current Scope: The goods covered by the CBAM are summarised in the table below
| Product category | Products |
| Aluminium | Unwrought aluminium, aluminium powders and flakes, and all kinds of aluminium products (including bars, rods, wires, plates, sheets, foils, tubes and pipes, tube and pipe fittings, structures, reservoirs, tanks, casks, drums, cans, boxes, other containers, and cables) |
| Chemicals | Hydrogen |
| Cement | Cement clinkers, white Portland cements, other Portland cements, aluminous cements, other hydraulic cements, other kaolinic clays |
| Electricity | Electrical energy |
| Fertilisers | Nitric acid, sulphonitric acids, urea, ammonia (anhydrous or in aqueous solutions), nitrates of potassium, mixed fertilisers (nitrogenous mineral and chemical fertilisers, and other fertilisers containing nitrogen, phosphorus and/or potassium) |
| Iron and Steel | Agglomerated iron ores and concentrates (other than roasted iron pyrites), pig iron, ferrous products obtained by DRI and other spongy ferrous products, crude steel, and all kinds of iron and steel products* (including bars, rods, rails, wires, tubes, pipes, sheets and other flat-rolled products, reservoirs, tanks, casks, drums, cans, boxes, containers, as well as screws, bolts, nuts, hooks, and rivets) – *except certain ferro-alloys (only ferro-manganese, ferro-chromium, and ferro-nickel are covered), and ferrous waste and scrap (including remelting scrap ingots and steel) |
- Extension to Indirect Emissions: Includes emissions embedded in electricity use (scope 2). While the CBAM already covers indirect emissions for cement and fertilisers, it is not the case for other sectors. However, such extension is on the cards, and the European Commission has run a public consultation on the matter. Our scenario includes indirect emissions embedded in all CBAM products.
- Downstream Extension: Currently, the CBAM only covers basic materials such as sheets of steel or aluminium. However, extension down value chains, to more finished products such as car parts or cutlery, is also being considered. A legislative proposal is expected by the end of 2025. Our scenario extends the CBAM to vehicle parts and cutlery.
- Extension to Precursors: A few basic materials that serve as inputs in the manufacturing of CBAM goods are currently outside the CBAM scope but covered by the EU ETS. The Commission has also run a public consultation on the opportunity to include some of them in the CBAM. In our scenario, the extension would cover ferro-silicon, lime, coke (for steel), alumina and pre-bake anodes (for aluminium).
- Extension to New Sectors: The potential inclusion into the CBAM of new sectors is suggested in several places of the CBAM Regulation: article 30(2) (organic chemicals and polymers), recital 35 (refinery products) and recital 34 (organic chemicals). In our scenario, the CBAM is extended to 8 basic polymers, 7 refinery products and 3 chemical products.
How are carbon emissions calculated across different products?
- Steel: Whether long or flat products; scrap percentage, pig iron and DR percentage; DRI and pig iron emission intensity.
- Aluminium: Percentage of scrap vs. primary aluminium emission intensity.
- Cement: Emissions are based on clinker content and process emissions per tonne of clinker.
Related Publications
The EU CBAM: a two-way street between the EU and Africa
Sandbag’s newly released CBAM Simulator allowed us to explore how the EU’s Carbon Border Adjustment Mechanism (CBAM) could impact African exporters — and how cleaner production and carbon pricing could turn a cost into a competitive edge.
Sandbag’s Response to the CBAM Calls for Evidence
Sandbag has submitted responses to the EU’s CBAM calls for evidence, addressing emissions reporting, adjustment for free allocation, and carbon prices paid abroad. We highlight risks such as loopholes and unequal treatment, and propose practical solutions to strengthen CBAM’s effectiveness and fairness.
CBAM impact on US trade: an analysis
Sandbag’s September 2025 research note explores the impact of the EU’s CBAM on US exports. It finds that even with expanded scope, the financial impact remains marginal — and US carbon pricing could turn net costs negative.
