Serbian aluminium exporters have received some relief from the European Union’s carbon border rules after the European Commission clarified that electricity consumption is not included in the embedded emissions calculation for aluminium products covered by the Carbon Border Adjustment Mechanism. The focus is instead shifting toward direct industrial emissions and the carbon intensity of aluminium used as a precursor.
- Precursor aluminium becomes a key CBAM factor
- Impol Seval faces direct and feedstock exposure
- Carbon exposure could affect margins
- Recycling and traceability gain importance
- Alumil YU relies on precursor documentation
- MTC NISSAL must map an integrated production chain
- Compliance spending adds another cost layer
- EU carbon rules separate regulatory and commercial exposure
The Commission’s Guidance Document 5E, published on 14 August 2026, covers unwrought aluminium and a broad range of downstream products, including powders, bars, profiles, wire, plates, sheets, strip, foil, tubes, structures, containers and other aluminium articles. Aluminium scrap under CN 7602 and household articles under CN 7615 are outside the listed scope. The guidance is explanatory rather than legally binding, but provides the Commission’s most detailed interpretation so far of aluminium emissions accounting during the definitive CBAM period.
For Serbian manufacturers, the distinction is significant because the country’s aluminium industry is heavily exposed to European trade. Serbia exported around $853.7 million of aluminium and aluminium articles in 2025, with the EU accounting for approximately $505.7 million, or 59.2%, of the total. The Czech Republic, Germany and France together purchased about $346.2 million, representing more than two-thirds of Serbia’s EU-bound aluminium exports.
Plates, sheets and strip were Serbia’s largest aluminium export category, followed by containers, other aluminium articles, structures, bars and profiles. The export structure reflects the country’s role in processing rather than primary aluminium production, with industrial activity concentrated on rolling, extrusion, recycling, alloy preparation, fabrication and surface treatment.
Precursor aluminium becomes a key CBAM factor
The Commission’s methodology differentiates between primary aluminium production, secondary melting and downstream processing. Primary smelters must account for emissions from anodes and paste, fuel combustion, flue-gas treatment and perfluorocarbons including CF4 and C2F6. Secondary aluminium producers report direct fuel emissions, while scrap receives a zero embedded-emissions value under the methodology. Rolling and extrusion plants are treated as producers of “complex goods”, meaning their calculation combines direct emissions from processing with the embedded emissions associated with the unwrought aluminium used as a precursor.
That distinction could make precursor sourcing one of the most important commercial variables for Serbian exporters. A plant with efficient furnaces and controlled fuel consumption could still report a high embedded-emissions value if it purchases primary aluminium with a carbon-intensive production route and insufficiently documented emissions data. Conversely, significant recycled content or verified low-carbon billets could reduce the reported embedded-emissions value even when the manufacturing facility continues to consume electricity from Serbia’s carbon-intensive grid.
Impol Seval faces direct and feedstock exposure
Impol Seval, based in Sevojno and 70% owned by Slovenia’s Impol Group, provides a major example of how the rules could affect Serbian aluminium processors. Its operations include casting, recycling, hot rolling and cold rolling, allowing the company to produce higher-value rolled aluminium products. The company produced 47,577.9 tonnes in 2025, down 9.6% from 52,632 tonnes in 2024. Its consumption included approximately 15.08 million cubic metres of natural gas and 39.50 GWh of electricity.
Impol Seval reported 28,267 tonnes of CO₂ equivalent in direct Scope 1 emissions, equal to 0.594 tonnes per tonne of production. Its location-based Scope 2 emissions amounted to 43,415 tonnes, based on a disclosed Serbian electricity-grid factor of 1.099 kilograms of CO₂ per kWh.
The figures illustrate the effect of excluding electricity from the aluminium CBAM calculation. Electricity accounted for approximately 61% of Impol Seval’s combined reported Scope 1 and location-based Scope 2 emissions in 2025. Under the current guidance, however, those indirect emissions are not included in the CBAM embedded-emissions calculation. The company’s 0.594-tonne-per-tonne Scope 1 intensity is therefore much closer to the relevant starting point for its processing emissions than the combined site figure of approximately 1.507 tonnes per tonne. The corporate emissions inventory should not, however, be treated as an equivalent of a verified CBAM product value because the two methodologies may use different production boundaries.
The final CBAM calculation must also incorporate embedded emissions from the aluminium precursor and account for the amount of input required to manufacture a tonne of finished product. Material losses and cutting yields can therefore affect the result because the methodology considers the precursor mass entering production.
Carbon exposure could affect margins
The potential financial impact becomes clearer when different emissions intensities are applied to a hypothetical CBAM certificate price. At €75 per tonne of CO₂, a direct-emissions intensity of 0.594 tonnes corresponds to approximately €44.55 per tonne of product. Applied to Impol Seval’s entire 2025 production, that would represent around €2.12 million. At certificate prices of €50 and €100, the corresponding amounts would be approximately €1.41 million and €2.83 million.
These figures are exposure scenarios rather than forecasts of an actual CBAM liability. They assume that all production is covered and exported to the EU, while excluding phase-in effects and other regulatory adjustments. The formal CBAM obligation rests with the EU importer, although costs can be transferred upstream through purchasing prices, contractual carbon clauses, warranties and demands for verified emissions information. The precursor could create an even larger difference. At €75 per tonne of CO₂, aluminium feedstock carrying an embedded-emissions value of 1.5 tonnes compared with material carrying 6 tonnes would produce a difference of approximately €337.50 per tonne of aluminium input.
For a processor unable to substantiate supplier emissions information, the resulting commercial impact could therefore exceed the carbon value associated with its own processing operations. The issue is particularly relevant for Impol Seval after it recorded a €4.69 million net loss in 2025, compared with a marginal profit in 2024. Year-end capital fell to €67.23 million. Impol Group attributed the weaker performance to difficult European market conditions, lower capacity utilisation and margin pressure, together with a machine breakdown at Sevojno late in the year.
CBAM compliance consequently adds a data and procurement dimension to the company’s cost management. Suppliers will need to be assessed not only on metal premiums, alloy specifications and delivery schedules, but also on verified embedded emissions. Sales agreements may also need to establish how financial risks are allocated when installation data are rejected or default values apply.
Recycling and traceability gain importance
Impol has established a target of cutting emissions per tonne by 58% by 2030 from the 2021 baseline. Its rolling division is also targeting at least 35% secondary aluminium in the average charge. The group obtained Aluminium Stewardship Initiative Performance Standard and Chain of Custody certification in 2025. Those systems provide support for traceability and responsible sourcing, but they do not replace CBAM-specific monitoring, reporting and third-party verification.
Impol Seval’s recycling and casting operations could support product lines with clearly documented primary and secondary aluminium content. Under the Commission methodology, scrap carries zero embedded emissions, but producers must still document scrap volumes consumed per tonne of product, distinguish pre-consumer scrap and report alloying elements exceeding 1%. That makes batch-level and furnace-level mass-balance controls important for any low-carbon product calculation.
Alumil YU relies on precursor documentation
Alumil YU Industry in Nova Pazova has a different operating profile. The Serbian subsidiary of Greece’s Alumil Group operates an integrated 35,000-square-metre facility containing two extrusion lines, powder coating and thermal-break production. The plant has publicly reported annual capacity of approximately 14,000 tonnes and employs more than 400 people. Its production serves Serbia as well as customers elsewhere in Europe.
For Alumil, fuels used in extrusion and heat-treatment operations generate the main direct emissions relevant to the Serbian installation. Electricity used by presses, handling equipment and other machinery remains important for broader product-footprint calculations, customer procurement requirements and sustainability reporting, but is excluded from the aluminium CBAM embedded-emissions calculation under Guidance 5E. The key issue is the origin and documentation of billet supplies. Alumil has stated that recycled aluminium used in its profiles is processed within the group’s industrial system in Kilkis, Greece. An integrated Greek-Serbian supply chain could therefore support lower-carbon precursor sourcing if individual production batches can be linked to appropriate origin and emissions documentation.
Guidance 5E allows the origin of EU or exempt-territory precursor goods to affect their treatment, but the relevant evidence must remain verifiable. Group ownership and internal invoices alone do not establish the complete CBAM evidence chain. Alumil YU received a new integrated environmental permit in February 2025 covering aluminium-profile production and surface treatment. The permit addresses energy efficiency, wastewater reuse, hazardous waste and the application of best available techniques.
For CBAM purposes, the company must connect fuel consumption, production volumes, scrap movements and precursor declarations with the individual products being manufactured and exported.
MTC NISSAL must map an integrated production chain
MTC NISSAL in Niš presents a more vertically integrated production structure. MTC acquired NISSAL’s profile-extrusion operations in 2020 and subsequently took over broader industrial capacity covering foundry operations, a drawing mill, bar production, machining and surface treatment.
The site includes a 1,500-tonne-force extrusion press and a larger 3,000-tonne-force press. Employment was approximately 269 people in 2023. Vertical integration gives the company greater control over metal preparation and conversion, but also creates more complex accounting requirements. Foundry operations, billet or bar production, extrusion, machining, anodising and powder coating can involve different emissions methodologies and production boundaries.
The Commission allows a joint production process where an intermediate precursor remains within the combined process. Where billets or other intermediate products are transferred or sold outside that process, separate accounting may be required.
MTC NISSAL therefore needs to map physical production flows against commercial transfers and legal entities to determine where unwrought aluminium becomes a precursor and where embedded emissions must be carried into subsequent products. Its foundry operations could also benefit from controlled scrap use and verified secondary aluminium. However, secondary content must be supported by evidence covering scrap quantities, classifications, primary additions, alloying materials, production losses and fuel consumption.
Compliance spending adds another cost layer
Initial CBAM-readiness spending for a mid-sized Serbian aluminium installation is estimated at approximately €300,000–€800,000, with recurring annual costs of €150,000–€400,000. These analytical estimates cover process metering, data systems, ERP integration, laboratory and mass-balance controls, supplier assurance, verification and specialised personnel, but exclude major furnace replacement or wider decarbonisation projects. An extrusion facility with a narrower product range could require around €150,000–€450,000 initially, while an integrated foundry and extrusion operation could face initial requirements of approximately €250,000–€700,000. The estimates are not company-disclosed budgets. Costs depend not only on production volume but also on the number of alloys, suppliers, production routes and data transfers that need verification.
The implications also extend to financing and trade. An EU buyer unable to rely on a Serbian exporter’s emissions declaration could use a higher default factor in pricing, retain part of a payment or seek contractual indemnification. A theoretical precursor emissions difference of €300–€600 per tonne could materially affect the operating margin of a standard rolled or extruded product. Carbon-data quality can therefore influence receivables, liquidity and covenant resilience even though the Serbian manufacturer is not directly responsible for purchasing CBAM certificates.
EU carbon rules separate regulatory and commercial exposure
The Commission’s decision to exclude electricity from the aluminium CBAM calculation reduces the immediate impact of Serbia’s carbon-intensive electricity mix on the legally defined embedded-emissions figure. It does not eliminate the commercial relevance of electricity-related emissions. European customers can continue to assess full product footprints, while sustainability standards and corporate procurement policies may include Scope 2 emissions. The distinction therefore separates the legally prescribed CBAM calculation from the broader carbon footprint used in commercial relationships.
For Impol Seval, the key requirement is to connect recycled content and lower-carbon aluminium purchases with individual rolled products. For Alumil YU, the challenge lies in converting its Greek-Serbian supply chain into verifiable precursor documentation. For MTC NISSAL, the priority is to distinguish the emissions characteristics of foundry, extrusion and finishing activities while maintaining the advantages of an integrated production structure. Serbian aluminium exporters are consequently moving from exposure to the country’s electricity mix toward a more detailed requirement to document, tonne by tonne, the aluminium entering their plants, its production route and the emissions information carried through to products sold into the European Union.
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