Production Process
The production process is the part of your installation where the chemical and physical processes occur to produce CBAM goods - in other words, the factory's area where your CBAM goods are manufactured.
Under the EU CBAM regulation, goods with different CN codes that can be covered by common monitoring rules are grouped into so-called "aggregated goods categories". These categories are used to determine how many production processes you need to define.
Once a production process is defined, emissions are attributed to the goods it produces. In other words, emissions are always calculated at the production process level.
When do you need to define multiple production processes?
- If you produce goods from different categories, you must define a separate production process for each category.
- If you produce goods within a single category but use different production routes (methods), you can choose to define a separate production process for each route. For instance, if you produce unwrought aluminium, which falls under a single aggregated goods category, but produce both primary and secondary (recycled) aluminium, you can define separate processes for each.
Right-click on the screen and select CBAM > Production Process
Name the Production Process
Select the CBAM Goods
You can search for goods by CN code or name. The dropdown list includes only CN codes that fall within the scope of the EU CBAM.
View the corresponding aggregated goods category of the selected goods
Based on your selection, the platform will automatically display the corresponding aggregated goods category.
Since each aggregated goods category can only be linked to one production process, once you select a good from the dropdown, you won't be able to select goods from different categories.
To select goods from other categories, you will need to either remove the selected goods or create a separate production process.
Select the Production Route (Method)
The Production Route (Method) refers to the industrial process used to produce the CBAM goods. Each aggregated goods category has a list of production routes that are covered by the EU CBAM.
For some categories, only one option is available, indicating that all production routes are included. In such cases, the dropdown menu will display a single entry.
Select the Measurement Unit
If you enter the value in kg, it will be automatically converted to tonnes when you save the form.
Enter the Net Mass produced of the selected CBAM good(s)
Only the net mass of saleable products leaving the production process must be entered. This value must exclude:
- scrap, by-products, or waste materials generated during production;
- products that do not meet the desired quality or product specification and are returned for re-processing.
SPECIAL RULES:
- If you produce final iron or steel products that contain more than 5% by mass of other materials, only the mass of iron or steel shall be reported as the mass of the goods produced.
- If you produce aluminium products that contain more than 5% by mass of other materials, only the mass of aluminium shall be reported as the mass of the goods produced.
If applicable, enter the weight of any by-products that were generated during the production process.
For instance, the quantity of scrap or slag generated.
Add any Notes
Use the Notes field to provide any additional information, such as assumptions used to calculate the total net mass produced or other relevant details. For instance, if you started tracking the net mass production of your CBAM goods in June 2023, explain the assumptions you used to estimate production for the previous months of 2023.
Explanations should be clear enough for a third party to understand the assumptions made and how values were derived.
Click Next
If you produce primary unwrought aluminium, you must include PFC emissions, which will add to your direct (Scope 1) emissions.
The gases to be monitored are Carbon Tetrafluoride (CFโ) and Hexafluoroethane (CโFโ). Emissions from anode effects as well as fugitive emissions are to be included. The method followed by the EU CBAM Regulation is based on the guidance "Aluminium sector greenhouse gas protocol" published by the International Aluminium Institute (IAI).
Right-click on the screen and select CBAM > Production Process
Select any good under the aggregated goods category of Unwrought Aluminium
Select Primary (electrolytic) smelting as the production method
Select the PFC Emissions Method
Two different methods are allowed: the slope method and the overvoltage method. Which method you want to apply depends on your installation's process control equipment.
Right-click on the Production Process
Click Edit
Click Next to save your changes
Right-click on the Production Process
Click Delete
If you produce CBAM goods that are used as inputs to manufacture other CBAM goods within your installation, and these fall under a separate aggregated goods category, you must connect the production processes. This ensures that the embedded emissions of the initial CBAM goods (referred to as relevant precursors) are accurately attributed to the final CBAM products.
The same principle applies to CBAM goods purchased from your suppliers, with the key difference being that, in those cases, you need to request the emissions data from them.
For example, connecting production processes is relevant if you operate integrated steel mills, aluminium plants producing both unwrought and finished aluminium products, or integrated cement mills producing both clinker and cement. In such cases, you need to monitor fuel and/or material streams between the different production processes to ensure emissions are correctly attributed to each of them.
Add your first production process by following the same steps outlined above
Add your second production process by following the same steps outlined above
Click on the black dot at the edge of the Clinker Production Process and drag the line to connect it to one of the black dots on the Cement Production Process
Click the dropdown to select the type of output you want to connect
Select Produced CBAM Goods
Enter the quantity of the produced CBAM goods that you want to send from one production process to another
The system will display the quantity you have already attributed and the remaining quantity available for attribution. You won't be able to attribute more than the remaining quantity. If you attempt to do so, an error message will appear.
Click Add
Both production processes are now connected
In the diagram below, no emissions are attributed because no external inputs have been connected to the Clinker Production Process.
You won't be able to connect a production process that is not a relevant precursor to another process. In such cases, the platform will display an error message.
Information about which precursors are relevant to each production process is listed in section 3 of Annex II of the CBAM Implementing Regulation.
To begin attributing emissions between connected production processes, you must first add external inputs.
The graph below illustrates a cement installation that consumed 800,000 tonnes of crude oil and 80,000 MWh of electricity to produce 1,000,000 tonnes of clinker. Of that production, 900,000 tonnes of clinker were used to manufacture 700,000 tonnes of cement. The cement production process required an additional 20,000 MWh of electricity.
All quantities correspond to the specified reporting period, which in this example is the calendar year 2023, as indicated in the lower-right corner of the platform's screen.
Calculation steps performed by the platform
Note: The calculation factors in this example, such as Net Calorific Values (NCVs) and emission factors, are provided by Carbon Glance. Below, we use dots (.) for decimal numbers and commas (,) to separate thousands.
๏ปฟClinker Production Process๏ปฟ
Direct Emissions: (800,000 tonnes of fuel x 0.0423 TJ/tonne of fuel) x 73.3 tCO2e/TJ = 2,480,472 tCO2e
Direct specific embedded emissions (SEE): 2,480,472 tCO2e รท 1,000,000 = 2.480472 tCO2e/tonne of clinker
Indirect Emissions: 80,000 MWh of electricity x 0.2283 tCO2e/MWh = 18,264 tCO2e
Indirect specific embedded emissions (SEE): 18,264 MWh รท 1,000,000 = 0,018264 tCO2e/tonne of clinker
๏ปฟCement Production Process๏ปฟ
Direct Emissions: 900,000 tonnes of clinker x 2.480472 tCO2e/tonne of clinker = 2,232,424.8 tCO2e
Direct SEE: 2,232,424.8 tCO2e รท 700,000 tonnes of cement = 3.1892 tCO2e/tonne of cement
Indirect Emissions: (900,000 tonnes of clinker x 0,018264 tCO2e/tonne of clinker) + (20,000 MWh x 0.2283 tCO2e/MWh) = 21,003.6 tCO2e
Indirect SEE: 21,003.6 tCO2e รท 700,000 tonnes of cement = 0.0300 tCO2e/tonne of cement
Right-click on the connector
Click Edit
You can also open the edit form by simply clicking on the connector.
Enter the new value
If you edit the form, the remaining amount will be displayed as if no attribution had been made yet.
Click Add
All values will be automatically re-calculated by the platform based on the new attributed quantity
The image below shows the comparison in the CBAM good emission values between attributing 900,000 tonnes of clinker to the cement production process and attributing 950,000 tonnes.
All else being equal, the emissions will be higher.
Right-click on the connector
Click Delete
The platform will automatically recalculate the emissions
The diagram below shows that after removing the connection with the Clinker Production Process, the emissions of the Cement Production Process are now 4,500 tCO2e, which result from the 20,000 MWh of electricity consumed. This, in turn, affects the SEE values of the CBAM goods, which are also automatically adjusted. The direct SEE is now 0 tCO2e/tonne of cement, and the indirect SEE is 0.0065 tCO2e/tonne of cement.
You can always reconnect both production processes, and the emissions will be automatically recalculated.
If your installation also produces goods that do not fall under CBAM Scope, you should add a Non-CBAM Production Process to allocate inputs such as electricity or fuels consumed by those processes.
This will provide a more accurate picture of the emissions attributed to your CBAM production process(es).
Right-click on the screen and select Non-CBAM Production Process
You can only add a single Non-CBAM Production Process, which will be used to represent all of your Non-CBAM Production Processes.
The diagram below shows an installation with both a CBAM Production Process and non-CBAM Process(es). All fuels and electricity consumed by these non-CBAM process(es) are attributed to them, helping to understand the quantities that drive the CBAM emission values.
Moreover, this helps understand where the remaining quantities of electricity, fuels, and other inputs were used within the installation, as the attributions are made from the total consumption down to the specific production processes (top-down approach).
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