Insider Brief:
- Steel is a critical part of the European economy, EC President Ursula von der Leyen said.
- The EU will focus on ensuring access to clean and affordable energy for the sectors.
- It will also target carbon leakage and de-risk decarbonization projects.
The European Commission on March 19 launched its plan to decarbonize the steel and metal industries with an action plan.
The six pillars in the plan include ensuring access to clean and affordable energy, preventing carbon leakage, expanding and protecting European industrial capacities, promoting circularity for metals, and de-risking decarbonization projects through lead markets and public support.
Steel remains critical for the European market, EC President Ursula von der Leyen said.
“To make sure [steelmakers] remain competitive, we must reduce energy needs and help them introduce innovative, low-carbon technologies to the market.”
The plan foresees ensuring faster grid access for energy-intensive industries, and calls for increasing the use of renewables and low-carbon hydrogen energy sources.
Preventing carbon leakage will entail a strong Carbon Border Adjustment Mechanism, already in place, as well as ensuring that non-EU industries do not “greenwash” their products, the plan stipulated. The Commission will also release more information this quarter on how to prevent carbon leakage in European-produced goods shipped to third countries.
Trade protection for the EU’s steel sector remains high on the agenda, with the Commission planning to release a new long-term measure when the current one expires in mid-2026.
The commission’s plans to encourage circularity in the sector include trade measures on metal scrap, which is a vital input for decarbonized steel.
The EU also will work to de-risk decarbonization with the approaching passage of the Industrial Decarbonization Accelerator Act, which will establish resilience and sustainability criteria for European products in public procurement.
The EU also vowed to protect the nearly 2.6 million people employed directly or indirectly by the steel and metals industries to support skills development.
