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EU Carbon Pricing on Logistics and Energy: What It Means for Metal Packaging Costs in 2026–2028

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Uncategorized | By: AkvaProfit Team
Date of publication: June 18, 2026

Three EU carbon-pricing mechanisms are now hitting metal packaging supply chains simultaneously, each through a different channel.

The EU Emissions Trading System (EU ETS) — the long-established cap-and-trade for industrial emissions, including steel and aluminum production — is tightening as free allowances for the substrate industries phase out and as the Carbon Border Adjustment Mechanism (CBAM) reaches its definitive period in 2026.

The EU ETS extension to maritime transport, in its phase-in period since 2024, is already adding a measurable line item to ocean freight costs and ramping toward full coverage in 2027.

The EU ETS2 for buildings, road transport and small industrial emitters — originally scheduled for operational start in 2027 — has been postponed by one year to 1 January 2028 under the amended European Climate Law adopted in March 2026. Auctioning of allowances begins as planned in 2027, but obligation to surrender begins in 2028.

For food producers procuring metal cans, easy-open ends and tinplate substrates, each mechanism affects a different cost-stack component: ETS hits substrate at the mill, the maritime extension hits ocean-freighted inputs, ETS2 hits over-the-road logistics and gas/electricity used in conversion and warehousing. The three together restructure the procurement cost stack through 2026–2028.

This article is a procurement-side decomposition: what each mechanism does, where it bites in the metal-packaging supply chain, and what to extract from suppliers and write into contract language before Q3 closes.

EU ETS — what is changing now (and why CBAM mostly handles it EU ETS — operating under Directive 2003/87/EC as amended — covers industrial CO₂ emissions from power generation, energy-intensive industries (including steel and aluminum production) and intra-EEA aviation. Allowances are auctioned and traded; the carbon price is set by the market against the cap.

Two things are moving simultaneously in 2026–2030.

Free allowances for substrate producers are phasing out. Historically, EU steel and aluminum producers received free allowances to compensate for carbon leakage risk relative to non-EU producers. With CBAM in its definitive period from 1 January 2026, those free allowances are being phased out progressively through 2034. EU-mill substrate now carries a growing implicit carbon cost via reduced free allocation.

The ETS price itself is tightening. The Market Stability Reserve mechanism for EU ETS removes excess allowances from circulation when the surplus exceeds a volume threshold; supply has been getting structurally tighter. Spot prices have generally trended above the historical baseline through 2024–2026.

For metal-packaging procurement, ETS effects flow primarily through substrate pricing — and CBAM is the relevant disclosure mechanism that surfaces them. The previous article on CBAM and metal packaging costs decomposes the channel in detail. The two key takeaways relevant here:

  • For substrate originating from EU mills, the embedded carbon cost rises as free allocation phases out — even without CBAM ever being formally applied at import.
  • For substrate originating from non-EU mills, CBAM is the formal mechanism for cost passthrough.

The procurement implication: ETS-driven substrate cost movement should already be in 2026 supplier-pricing-mechanism conversations and contract language. If it is not, the contract is exposed.

EU ETS extension to maritime transport — already biting

The EU ETS was extended to cover maritime transport emissions starting in 2024. The phase-in schedule is:

  • 2024 reporting year: shipping companies surrender allowances for 40% of reported emissions.
  • 2025 reporting year: 70% of reported emissions.
  • From 2027 onward: 100% of reported emissions, including CH₄ and N₂O alongside CO₂ (added from 2026).

The scope covers ships above 5,000 gross tonnage on intra-EU voyages (100%) and on extra-EU voyages with EU port calls (50%). Shipping companies that fail to surrender adequate allowances face penalties and operational restrictions.

The cost passthrough to cargo customers is already visible. According to the [European Commission’s first report on the maritime ETS extension]https://climate.ec.europa.eu/eu-action/transport-decarbonisation/reducing-emissions-shipping-sector_en), the average 2024 impact on total shipping costs was projected at approximately 3.7% under the assumption that operators take no offsetting energy-efficiency or emissions-reduction measures. In observed market practice, container shipping freight rates have seen ETS surcharges in the range of 1–5%, and some ferry routes in Europe have seen surcharges of 3–11%. As coverage expands through the phase-in, freight cost increases of up to roughly 5% by 2028 are projected, with variation by route, vessel and operator efficiency.

For metal-packaging supply chains, the maritime ETS bites in three places.

Substrate inbound from non-EU mills — Turkish, Indian, Chinese, Korean, Vietnamese tinplate and aluminum stock shipped to EU converter or fill sites. Carries both the CBAM cost (direct, on the goods) and the maritime ETS cost (on the freight).

Inbound substrate within Europe by short-sea shipping — selected routes e.g., from mills in Western European ports to packaging-conversion sites in Iberia, Mediterranean and Baltic) — affected by intra-EU 100% coverage.

Outbound finished-can shipments to EU customers via short-sea or feeder services. Where finished cans move by sea, the carbon cost component is present.

The procurement question is whether the supplier — at substrate-inbound and at finished-can outbound — is pricing the maritime ETS cost explicitly in the contract, or whether it is being absorbed into a flat unit price that will be renegotiated under pressure later. Explicit pricing is the procurement-friendly answer.

EU ETS2 — postponed to 1 January 2028, but still coming

ETS2 establishes a separate cap-and-trade system covering CO₂ emissions from fuel combustion in buildings, road transport, and small industrial installations not covered by the main ETS. Allowances are distributed exclusively via auctioning; the regulated entities are fuel suppliers (upstream) rather than end consumers — meaning the cost flows through fuel prices to truckers, building operators and small industrial fuel users.

The original ETS2 timeline scheduled trading to begin in 2027, with first compliance surrender in 2028. In March 2026, under the amended European Climate Law adopted by the Council and the European Parliament, ETS2 was postponed by one year. The current operational timeline is:

  • 2027: Auctioning of ETS2 allowances commences as originally planned — generating revenue for the Social Climate Fund ahead of the system’s operational start.
  • 1 January 2028: Operational obligations begin formally. Fuel suppliers must report and surrender allowances for in-scope fuel volumes — the cost-bearing step of the ETS2 cycle applies from this date.
  • From 2028 onward: The carbon price flows through to fuels — petrol, diesel, heating oil, natural gas, LPG, coal — used in covered sectors.

The Social Climate Fund — established under Regulation (EU) 2023/955 — is funded by a share of ETS2 auction revenue and is designed to mobilise at least €86.7 billion between 2026 and 2032 to support vulnerable households and micro-enterprises through the fuel-price transition.

Price expectations for ETS2 vary by analyst. The mechanism includes a Market Stability Reserve, with a threshold around €45/tonne CO₂ (2020 prices, inflation-adjusted) triggering additional allowance release if the price runs above it. In practice, ETS2 prices in early years are expected to be lower than the main ETS price but to converge over time.

For metal-packaging supply chains, ETS2 bites in two places that procurement should already be writing into 2027–2028 contract language.

Over-the-road logistics costs — every truck movement of substrate to converter, finished can to fill site, and finished food product to distribution centre runs on diesel that will carry the ETS2 carbon cost from 2028. Trucking rates will move in response.

Energy costs at converter and warehouse sites — small industrial gas and heating-oil consumption at can-converter facilities and at warehousing operations carries ETS2 cost from 2028, separate from the main ETS exposure of larger sites.

The procurement implication is timing. ETS2 trading begins in 2028, but contracts being negotiated in Q3 2026 with multi-year terms need to address whether ETS2 cost passthrough is in scope. A contract that locks unit pricing through 2028 without an ETS2 passthrough mechanism transfers the risk to the buyer.

How the three mechanisms stack across the metal-packaging cost structure

A simplified procurement view of where each carbon-pricing mechanism enters the cost stack of a delivered metal can:

Cost component Primary carbon mechanism Operational timing
Substrate (steel, aluminum) — EU mill EU ETS, free allowance phase-out Active and tightening through 2034
Substrate — non-EU mill CBAM (Reg (EU) 2023/956) Definitive period from 1 January 2026
Ocean freight (substrate inbound, finished outbound) EU ETS maritime extension Phase-in 2024–2027, 100% from 2027
Road freight (intra-EU trucking) EU ETS2 From 1 January 2028 (auctioning from 2027)
Converter energy (gas, electricity) Main ETS (electricity) + ETS2 (small industrial) Active; ETS2 from 2028 for in-scope sites
Warehouse energy and heating Main ETS + ETS2 Same as above

Three reading points:

  • In 2026, the active carbon-cost mechanisms are EU ETS (always) + maritime ETS (in phase-in) + CBAM (in definitive period). Substrate, ocean freight and substrate-origin disclosure are the live procurement conversations.
  • In 2027, ETS2 auctioning starts — generating revenue for the Social Climate Fund. ETS2 cost has not yet been surrendered, but suppliers and fuel distributors will be positioning.
  • From 1 January 2028, ETS2 cost is in fuel prices — over-the-road logistics, converter energy and warehouse fuel costs all move.

Contract language being agreed in Q3 2026 with terms running 12–24 months ahead needs to address each of these explicitly. A contract that bundles them all into one flat unit price hides the volatility from the buyer’s view — and almost certainly overprices for the supplier’s risk.

Pricing-mechanism contract language that holds up under three carbon fronts

Three structural options for a supplier contract through 2026–2028:

Structure 1 — flat unit price, valid for a stated window. Hides every carbon-cost movement. Looks orderly until renegotiation, at which point the buyer absorbs accumulated shock in one quarter.

Structure 2 — substrate index-linked, tied to a benchmark such as HRC, CRU or LME. Tracks raw-material movement but not the carbon-pricing components specifically.

Structure 3 — indexed and decomposed, separating the line items: substrate index + CBAM cost component + maritime ETS surcharge (where applicable) + ETS2 logistics/energy component (from 2028). Visible. Auditable. Forecastable.

For 2026–2028, Structure 3 is the only structure that gives procurement visibility into what is moving and why. Procurement language to push for in any contract renewal this quarter:

  • Substrate origin and pricing-mechanism disclosure — mill names, country, share of substrate that is CBAM-exposed (non-EU origin), and the formula tying substrate price to benchmarks.
  • CBAM cost component itemised — tied to ETS auction prices and embedded emissions per tonne.
  • Maritime ETS surcharge handling — for substrate or finished-can flows moved by sea, the surcharge mechanism by which the supplier applies the carbon cost.
  • ETS2 cost-passthrough clause — anticipating 1 January 2028, the contract specifies the basis on which ETS2-driven logistics and energy cost movement will be reflected in pricing.
  • Reset cadence and audit rights — quarterly review of the mechanism, with the buyer entitled to verify against published ETS / ETS2 auction data.
  • Forward indication — supplier provides H2 2026, 2027, and 2028 directional guidance, framed as indicative.

A supplier who balks at the carbon-cost-decomposition framing is either commercially unsophisticated or hiding what is being passed through. Both are problems for a multi-year supplier relationship that runs through the ETS2 operational start.

Seven questions to ask every metal packaging supplier before 30 September

  1. What is the current substrate cost structure, decomposed into raw material + ETS-driven embedded carbon + non-ETS components, by mill?
  2. What proportion of substrate moves by ocean freight — for inbound to the converter and for outbound finished cans — and how is the maritime ETS surcharge currently being applied?
  3. What is your forward indication for the maritime ETS phase-in cost through 2027 (when 100% coverage applies)?
  4. What proportion of your logistics flow is over-the-road within the EU, and what is your contingency for the ETS2 cost-passthrough beginning 1 January 2028?
  5. At converter and warehouse sites, what proportion of energy consumption is gas, heating oil or diesel — and therefore ETS2-exposed from 2028?
  6. What hedging arrangements are in place for EU ETS allowances directly held or indirectly exposed through substrate, and what is the typical duration?
  7. What documentation will you provide on the carbon-cost components — ETS, maritime ETS, ETS2 — on what cadence?

Suppliers who answer all seven in writing with current data are operating to a mature pricing-mechanism standard for the 2026–2028 carbon transition. Suppliers who answer four or five with documentation and the rest with verbal commitment are workable but flagged. Suppliers who deflect or respond only with sustainability brochures are the supplier-risk concentration this exercise was designed to surface.

The intra-EU positioning question

A food producer buying cans, EOE or tinplate from a supplier whose substrate, logistics and converter footprint are concentrated within the EU has different carbon-cost exposure than one whose supplier is leaning on non-EU substrate flows, long ocean-freight legs or sea-transported finished goods.

The intra-EU position is not free of carbon-cost movement — ETS free allowance phase-out and ETS2 effects both apply — but it is materially more transparent. Substrate origin, logistics routing and energy mix are documentable in single-jurisdiction terms, with prices and cost passthrough mechanisms following EU-internal rules.

This matters for supplier diversification strategy. A procurement team running a supplier review in mid-2026 may already have one or more non-EU-substrate-exposed or sea-transport-exposed suppliers in the mix. The Q3 question is whether to add or substitute to an EU-substrate, EU-logistics-concentrated supplier for selected formats, locking in a clearer carbon-cost trajectory through 2026–2028.

This is a second-source conversation, not a primary-supplier displacement. Qualification of a new supplier on a known format typically takes 6–10 weeks. Initiated in early Q3, an EU-concentrated supplier can be sample-validated, documentation-cleared and approval-tier’d before the Q4 budget review, with first orders feasible in late Q4 or Q1 2027.

Action plan for Q3 — week by week

Weeks 1–2 (early to mid-June): Inventory the supplier base by carbon-cost exposure. For each supplier, map: substrate origin (EU / non-EU mix), inbound logistics (sea / road / mixed), converter and warehouse energy mix (gas / electricity / diesel), outbound logistics to fill sites.

Weeks 3–4 (mid-to-late June): Send a structured documentation request to every supplier — the seven questions above plus the parallel CBAM and EPR questions where the supplier is the same. Common template, response deadline 24 July.

Weeks 5–8 (July): Map responses against the three carbon-pricing mechanisms — ETS, maritime ETS, ETS2 — by supplier and SKU. Identify high-exposure SKUs where a contract review and rewrite are warranted before Q4.

Weeks 9–11 (August): Negotiate updated pricing-mechanism contract language on high-exposure SKUs. Push for Structure 3 (substrate index + decomposed carbon-cost components). Get written supplier forward indications for 2027 and 2028.

Weeks 12–13 (early September): Q3 supplier review with finance and operations leadership. Present the per-supplier carbon-cost exposure map, the contract-language gaps closed, the second-source qualification status, and the residual exposure carried into H2 and 2027.

What this does not cover — and where the conversation goes next

EU carbon pricing on logistics and energy is one set of cost mechanics. EPR fee modulation under PPWR is another. CBAM cost passthrough is a third. CSRD reporting on scope-3 supplier-level data is a fourth. These four restructure the procurement cost stack and the supplier-disclosure cadence together through 2026–2030.

A procurement team that builds a clean supplier-contract framework for carbon pricing also positions itself well for the adjacent conversations. The supplier-disclosure discipline that handles substrate origin, logistics mix and energy mix feeds CSRD scope-3 data. The pricing-mechanism discipline that handles maritime ETS surcharge and ETS2 cost passthrough applies equally to CBAM and EPR fee passthrough.

Q3 2026 is the window. The framework set now governs how the next 24 months of metal-packaging spend behaves under multiple overlapping carbon-pricing mechanisms — and where the procurement team has visibility versus where it does not.

Sources and primary references

This article is general procurement guidance. It is not legal, tax or compliance advice. Specific carbon-pricing exposure calculations, contract-language decisions, and supplier-relationship strategy should be reviewed with carbon-policy and procurement-tax advisors familiar with your operational footprint and the specific routes, fuels and energy mixes in your supply chain.

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