ArcelorMittal, thyssenkrupp Steel, and voestalpine have issued a joint call for urgent, pragmatic reform of the EU’s Emissions Trading System (ETS).
The companies, which make up 60% of Europe’s integrated steel production, have warned that without adjustments, the current trajectory risks destroying Europe’s industrial base.
Marie Jaroni, CEO of thyssenkrupp Steel, said: “The ETS needs a reality check. It does not reflect the current state of Europe’s industry, where competitiveness and transformation are becoming increasingly difficult to reconcile. That is why we need a cost pause in the ETS to safeguard the transformation and ensure that ‘first movers’ like us are not put at a disadvantage.
“The reform must help successfully bring climate protection and industrial development together for the future of Europe.”
The companies noted that while the ETS has reduced emissions in the power sector, it is not yet delivering a viable pathway for energy-intensive industries, such as steel.
They also highlighted that under the current framework, the cost of producing steel in the EU is expected to increase by approximately 50% by the early 2030s.
ArcelorMittal outlined that with steel-intensive imports not subject to an equivalent carbon cost, and EU steel exports receiving no rebate to recover the carbon cost, the implications of the sharp increase in ETS costs will be profound for European steelmaking and the entire value chain.
Lakshmi Mittal, executive chairman of ArcelorMittal, added: “A future for the ETS that incentivises decarbonisation without compromising competitiveness must be found. It is not an easy problem to solve, but reform of the ETS is essential, and we applaud Europe’s policymakers for putting the topic back on the agenda.
“The choice they face is not between climate ambition and competitiveness. The choice is between a climate strategy that strengthens Europe’s resilience and economic security, and one that hollows it out.”
