ArcelorMittal urges EU to pause rising carbon costs
ArcelorMittal, together with Thyssenkrupp Steel and Voestalpine, is calling for a temporary pause in the rising costs of the European Emissions Trading System (ETS). The three major players in the European steel industry warn that the CO₂ bill for companies is increasing too quickly, while, in their view, the conditions for producing greener steel on a large scale are not yet in place.
With their joint appeal, ArcelorMittal, Thyssenkrupp Steel and Voestalpine aim to put pressure on the European Commission, which is currently reviewing its ETS to align it with the climate targets set for 2040. The Commission has signalled it is willing to relax the system, which puts a price on CO₂ emissions, to help out European industry battling with higher energy prices and competition from cheaper steel produced elsewhere.
According to the companies, the cost of producing steel in Europe could rise by around 50 per cent by the early 2030s. Without adjustments to the ETS, they warn that 30 to 40 per cent of steel-intensive production activities in Europe could come under pressure, putting as many as 5 million jobs across the wider value chain at risk, including sectors such as the automotive industry, construction, transport and logistics.
The EU has introduced a Carbon Border Adjustment Mechanism (CBAM) to level the playing field with imported steel. But European steel producers argue that this protection currently falls short. They are therefore calling for a pause in rising ETS costs until green electricity, hydrogen, CO₂ storage and markets for climate-friendly steel become sufficiently available and affordable.
Risk for Belgium
The discussion also touches on an issue that has been hanging over Flanders for years. In 2021, ArcelorMittal announced plans to green its site in Ghent. However, a final investment decision on the 1.1 billion euro investment has still not been made. At the end of 2024, ArcelorMittal postponed the project indefinitely. In the meantime, management has revised its estimate upwards to around 2 billion euros, while warning that current economic conditions are not favourable enough to proceed.
Potential job cuts would significantly impact Belgium. ArcelorMittal operates sites in Ghent, Geel, Genk and Liège. Ghent is also its largest plant and one of Flanders' key industrial hubs. The company employs nearly 5,900 full-time equivalents in Belgium and recorded a turnover of more than 5.1 billion euros in 2024.
© BELGA PHOTO JONAS D HOLLANDER
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