On 1 January 2026 the European Union’s Carbon Border Adjustment Mechanism entered its definitive phase. Moroccan exporters of fertilisers, cement, steel and aluminium now report the emissions embedded in their products, and the price of those emissions will be due on the year’s imports. In the industrial groups concerned, the decarbonisation pathway has moved from the sustainability department to the finance department. And the first document to circulate is almost always the same: an abatement cost curve.
What the curve says
The tool is well designed for what it does. For each abatement lever, one estimates the net cost per tonne of CO2 avoided over the life of the investment, and the annual volume of emissions avoided. Levers are ranked by rising cost. The width of each bar is the volume, its height the cost. At a glance one sees what pays, what costs little, what costs a lot, and how many tonnes each band of cost buys.
It is an excellent basis for conversation between the plant manager and the finance director, because it speaks both languages at once. It is also a good filter: a lever at three hundred euros a tonne, when the EU allowance traded between sixty and ninety euros in 2024 and 2025, needs a justification other than carbon.
What it does not say
Negative costs are not gifts. The left-hand side of the curve, the levers that make money, is the most misleading. Heat recovery, variable-speed drives, lighting, utilities control: these measures have been profitable on paper for twenty years. If they are not done, a cost has gone uncounted: the production stop needed to install them, management attention, the missing skill, the hurdle rate the plant applies to every project. Those costs are real, and a pathway that assumes the bottom of the curve will happen “by itself” starts with a built-in delay.
Levers depend on each other. The volume avoided by electrifying a furnace depends on the emission factor of the electricity that will feed it. The volume avoided by a renewable power purchase agreement depends on what was electrified before. The bars cannot be added: each was computed with everything else held constant, and nothing is held constant once you begin.
The curve is a photograph. The costs it shows belong to one year, at a given energy price, cost of capital and carbon price. Solar and storage costs are falling; the EU allowance has a trend; the border adjustment is computed on that price minus a free allocation whose phase-out is scheduled. A lever costing one hundred and twenty euros a tonne in 2026 may cost sixty in 2030. One curve for ten years is an opinion about 2026 applied to 2035.
The discount rate decides everything. Two teams starting from the same data, one using six per cent and the other twelve, obtain two different rankings, and sometimes different signs for the same levers. A curve that does not display its financial assumptions cannot be discussed.
Cost per tonne is not the cheque. The cheapest lever per tonne can be the heaviest in upfront investment. A company has a borrowing capacity, a maintenance shutdown calendar and a cash position. The curve knows none of them.
The Moroccan case: the grid changes the ranking
In most curves produced for European sites, process electrification is a central lever, because the grid feeding it is already largely decarbonised. In Morocco the share of renewables in installed capacity has risen sharply, but coal remains the first source of generation, and the emission factor of a kilowatt-hour delivered by the grid is high. Electrifying a furnace or a boiler without securing dedicated renewable supply moves part of the emissions from the plant’s stack to the power station, and the European mechanism’s accounting, which follows electricity consumed, is not fooled.
The real ranking for a Moroccan site therefore places upstream two levers the standard curve puts elsewhere: contracting renewable electricity, through a direct medium- or high-voltage power purchase agreement or through self-generation under Law 82-21, and on-site generation where land and load profile allow. These are prerequisites, not bars among others. They change the cost and volume of everything that follows.
How to use it
The method we apply comes down to four decisions.
- One curve per site, not a group curve. Processes, energy contracts and land differ from one site to the next, and it is at the site that investment decisions are taken.
- One curve per period. Three horizons are enough, for instance to 2028, from 2028 to 2032, and beyond. Costs, carbon prices and prerequisites are reassessed at each horizon.
- Three columns, not one. Alongside cost per tonne, total investment, and the prerequisite: what must be done first for the lever to deliver the volume claimed.
- The cost of doing nothing, computed, next to the cost of acting: exposure to the European mechanism, tonnes declared multiplied by the expected allowance price, year by year, for exported volumes.
That work turns a curve into a pathway: dated milestones, an investment plan that respects financing capacity, and a measurement, reporting and verification system that will produce the figures the importer, the verifier and the banker will ask for. The curve remains useful. It is the beginning of the work, not its result.