8.Key concepts you will meet later

• Embedded emissions: direct emissions from production plus indirect emissions from electricity used, including emissions in precursors.
• Direct emissions: from the production process, including heating and cooling used.
• Indirect emissions: from producing the electricity used. Some goods count direct emissions only; your sector module says which.
• Simple vs complex goods: simple goods use only inputs with zero embedded emissions; all others are complex.
• Precursor: an input that is itself a CBAM good.
• Default vs actual values: actual = your verified data; default = official values with a mark-up. See S2.
• Carbon price paid: a carbon price paid at home can reduce certificates owed. See S3.
• Free allocation adjustment: a deduction reflecting free allowances EU producers receive. See S3.

Sources: REG Art 3(21)-(22), 3(27)-(28), 3(34), 7(1)-(2), 8, 9(1), 31(1), Annex IV points 1, 4.1; MA Art 1(7); G1 §2.2 p.8, §2.4.2 p.13-14.