Management + Systems

By Gabriel Rozenberg, CEO, CBAMBOO

About two years ago I started working on a new regulation with a bureaucratic name that promised to reshape industrial trade – the Carbon Border Adjustment Mechanism (CBAM) regulation. Here was a new law designed to reduce carbon emissions around the world, but it was also highly technical and complex. I realised that there would be a market for software that could make sense of CBAM and bring it under control. I wanted to put that software into the hands of as many people as possible. 

Today, the CBAMBOO Platform is the most advanced system for CBAM management on the market. When we talk to fastener companies going through CBAM compliance, it often feels like they are trapped in a tangled thicket of branches, trying to break free – our software is a precision trimmer. Instead of dealing with endless email chains asking for spreadsheets of data, everything is tidily organised with a simple and intuitive interface. Using the CBAMBOO Platform, CBAM reports take minutes, not weeks, to create. 

The CBAMBOO Platform is the best way for ‘declarants’ – EU-based importers of CBAM goods – to take control of their compliance. However, CBAM also creates huge reporting challenges for any company that sells fasteners and other CBAM goods into the EU – with many non-EU companies discovering that they must calculate their emissions information using the unique CBAM methodology. These supply chain companies, referred to in CBAM jargon as ‘operators’ need our help too. 

Free to use

That is why we decided to make the CBAMBOO Platform completely free for non-EU operators. Today, you can go to cbamboo.com and set-up your account with CBAMBOO and start compiling CBAM data straight away, no spreadsheets required. At the end, you can download and share your company’s CBAM data with your customers. 

Here’s a step-by-step to compiling your CBAM data on CBAMBOO. It’s a guide for fastener companies in the UK, and in other non-EU countries, to creating the data that your EU customers might be asking for. 

Product walkthrough

Users can set-up an account straight away by visiting www.cbamboo.com and clicking on ‘Get started for free’. They then enter their name and company details, set-up a password and create a login. From here, the user sets up their company, depending on where the business sits. A company importing fasteners into the EU, in its own name, would choose ‘Declarant’; a non-EU fastener business would choose either ‘Operator’ or ‘Distributor’ depending on whether it substantially transforms the goods in factories, or whether it merely acts as a stockholder; and a ‘Consultant’ is a company that uses CBAMBOO to support its clients’ reporting.  

Once an ‘Operator’ has set-up their account the homepage will prompt them to ‘Get Started’ on a list of tasks, guiding them through the process of creating CBAM data on their business. Once they have set-up the company, they will want to add other members of their team to help compile the numbers. The next stage is to create at least one ‘Installation’ – in other words, the manufacturing facility. By doing so, we now start to create a page of information about the business, listing all the manufacturing sites where fasteners are created or transformed. 

The purpose of the CBAM rules is to get manufacturers around the world to describe the amount of carbon dioxide, and equivalent greenhouse gases, that they create through their factory processes, then attribute those emissions to individual goods. To perform those calculations, businesses create a report on each installation for each calendar year, setting out the ‘Emissions Factors’ for each product line. 

It’s an abstract sounding process but CBAMBOO makes it easy to understand. Users just need to click onto the ‘Emissions Data’ page on the sidebar, and under ‘Installations’ put together a list of their facilities. For each one, they click ‘Add Report’ and enter the period that they want to report on, which for most companies will simply be the most recent calendar year. 

For the next step, the user will set out their factory data and calculate the emissions, using a tool called ‘Carbon Flow’. They simply click through to ‘Carbon Flow’ and they are presented with a canvas on which different boxes, or nodes, connect. This is a process flow diagram of how goods move through their manufacturing facility. The key elements here are ‘Precursor’ goods – CBAM goods that are brought into the facility – and the production process itself. For each element, the user can click on the relevant node to add detailed information. 

For ‘Precursors’, the user needs to click on the node and search for their suppliers, creating company names where businesses are not already on the platform. For the production process, there are a variety of options for how to calculate emissions, and the precise approach the user chooses will depend on how their factory is set-up. However, the simplest approach is to consider production emissions in two parts – emissions from combustion (burning solid fuel) and emissions from the electricity grid. 

For many companies, therefore, all that is required here is to list the number of tonnes of natural gas (or other solid fuel) that the company burned in the year; and the number of megawatt-hours of electricity that they required in that time. It’s two data points that can be found in the facility records. All the conversion factors that turn those data points into a carbon dioxide number are incorporated into the CBAMBOO Platform and are calculated automatically. 

Lastly, the user adds the goods that they created in the ‘Produced CBAM Goods’ node, identifying each one by its CN code. It is not necessary to split out individual KPIs unless the user has a specific reason for doing so.

Default values (industry average) are used as the starting point for all ‘Precursor’ emissions information. However, users can improve on that by asking their suppliers for actual data on their emissions. Again, a user can use the CBAMBOO platform to do this. The ‘Suppliers’ tab, accessible from the sidebar, gives the user an overview of all of their suppliers. As a user adds contact details for each supplier, the supplier will receive emails offering them to join the CBAMBOO Platform and start sharing their own CBAM data with the user – so that the user can improve the data quality of their report.

The user’s data is now ready for sharing with customers. They just need to head over to the ‘Emissions Data’ page, where they will see all the calculated information about each product, and click ‘Share’ to send their CBAM data to anyone who has requested it. 

The benefits of getting CBAM ready

Getting CBAM data accurate has many benefits for a company. EU businesses are increasingly aware that CBAM compliance is getting stricter, and they are starting to require accurate information from their supply chains. From next January, the CBAM system will become much more than a compliance process, transforming into a full system for pricing carbon at the border of the EU and effectively taxing it. 

That means that a company with a lower emissions profile suddenly has cheaper products to sell into the ‘Single Market’. It will be a huge business advantage for companies to have accurate CBAM data, with demonstrably low production emissions. Many UK fastener companies, powered by low carbon electricity grids and renewable power sources, will be able to skip the queue and increase their competitiveness as they sell to the EU.

CBAM is on track

In the past couple of months, European politicians and civil servants have been reviewing a great deal of their environmental legislation, in response to growing calls for simplification of the rules. That has led some people to wonder whether CBAM is going ahead as planned. As we read the signals, we believe that the answer is a firm ‘yes’. 

On the one hand, the threshold for which CBAM applies is being raised, to a probable 100 tonnes of CO₂ per year. However, at the same time, the European Commission is setting itself up to enforce CBAM much more strictly on those larger importers that remain in scope.

Fastener companies typically deal in high volumes and therefore have high embedded carbon emissions in absolute terms. The forthcoming simplification of CBAM is welcome, but it will become clear that fastener companies are still strongly affected. All the more reason, then, to try out the CBAMBOO Platform today and see how we can help you save time with your CBAM reporting.

We take the fastener community seriously and our whole commercial team will be at Fastener Fair Global in Stuttgart in March. Come and meet us at stand 3744 in hall 7. We’ll be delighted to showcase CBAMBOO to you.