With the EU’s Carbon Border Adjustment Mechanism (CBAM) having already entered its transitional phase in October 2023, installation operators exporting to the EU must take urgent steps to prepare for audit readiness. While the current phase focuses on emissions reporting, full implementation, along with financial obligations, will begin in 2026. Now is the time to put robust systems such as CBAM solution tools in place to avoid last-minute compliance risks
CBAM aims to ensure that the carbon cost of imports into the EU matches the price paid by EU producers. To stay compliant, installation operators must accurately track, report, and verify embedded emissions in their exported goods. Audit readiness means having the data, documentation, and processes in place to pass scrutiny by EU authorities and accredited verifiers.
Also read: CBAM reshaping global trade: Where does India fit in the changing business ecosystem?
5 Key steps for exporters to the EU to become CBAM solution ready:
1. Build Robust Emissions Monitoring and Reporting Systems
Install systems that allow real-time or periodic monitoring of process emissions. Emissions should be calculated using accepted CBAM methodologies. Exporters must be able to report quarterly on product-level emissions data, broken down by installation and product type.
2. Keep Comprehensive Records
Detailed documentation is non-negotiable. An organisation should:
- Maintain all calculation forms and templates
- Archive supporting evidence (energy inputs, material use, etc.)
- Log emission factors and calculation methodologies
- Record internal QA/QC steps taken
These documents form the audit trail, and without them, reported data could be rejected.
3. Implement Internal Controls for Accuracy
Your data needs to be accurate and consistent across all reporting periods. To achieve this:
- Compare data against authentic reference sources (like national inventories or international benchmarks)
- Conduct regular internal reviews of calculations
- Set up quality control protocols to flag anomalies early
4. Work Proactively with Third-Party Verifiers
All submitted emissions data must be verified by accredited third-party auditors. Be prepared to:
- Offer full access to systems, processes, and raw data
- Answer questions on methodologies used
- Share historical and comparative records as needed
- Verification is not just a one-time exercise
Also read: 5 Reasons exporters need a CBAM reporting tool
5. Prepare for the Shift from Reporting to Payment
As CBAM enters the definitive regime in 2026, inaccuracies could lead to penalties or loss of market access. CBAM represents a shift in how global trade accounts for carbon. For installation operators, this means building systems that are transparent, traceable, and verifiable.
The best way to approach is to leverage a CBAM reporting and tracking software. The efficiency and quality of a CBAM reporting tool depend on how well the software digitises and automates the emissions data. The CBAM solution tool should eliminate all the challenges related to data accuracy, accurate data collection and calculation faced by exporters. The right tool helps them accurately track and report the carbon content of goods being exported to the EU, ensuring they meet CBAM requirements and avoid penalties. It streamlines data collection, reduces administrative burdens, and improves transparency, making it easier to adjust pricing, plan for carbon costs, and remain competitive in the EU market.
Also Read: How to select a CBAM reporting software? 5 things to consider
The TSC Netzero: CBAM solution tool helps in automating data collection for each input and output of every process in a CBAM product’s production route. TSC NetZero’s CBAM reporting software ensures accurate product-embedded emission calculations at every level. It also assists in quarterly emission report generation by digitising the entire process. It also supports the tracking of carbon taxes paid along the supply chain.
In addition to these, our platform ensures digital auditing of reports with accurate trails. There is also an integrated facility for third-party and first-party verification, as well as digitising the third-party audits by inviting EU-accredited auditors via TSC Netzero’s assurance modules.
