Commission report confirms EU CO2 steel targets cannot be met
December 16, 2012
Emission targets set by EU climate policies are unachievable for the
European steel industry. This is the conclusion of study recently
published by the European Commission's Joint Research Centre (JRC).
It shows that the industry can reach a maximum of 11 to 19% reduction in CO2
emission up to 2030 if it applies current best technologies and
innovative solutions that may become available in the future. The 2030
target set by the EU Emissions Trading Scheme (ETS), however is 37.4%.
The 2030 milestone in the European Commission's â€˜Roadmap for moving to a
low carbon economy in 2050' is 43 to 48% for ETS-sector industries. The
JRC report demonstrates that it is impossible for steel companies to
meet these emissions targets.
The report by the European Commission's in-house science service is titled â€˜Prospective Scenarios on Energy Efficiency and CO2
Emissions in the EU Iron & Steel Industry'. The researchers have
developed scenarios that illustrate the influence of different prices
for fuel and resources as well as CO2 emissions allowances on
the energy efficiency performance of the industry. The report finds
that higher prices are â€˜ineffective as major levers of change.'
The maximum abatement values of 11 to 19% the authors have identified
refer respectively to the two major steel production routes via electric
arc furnaces and blast furnaces. Both values are based on a scenario
with a carbon price of â‚¬200/t. This shows that even under the pressure
of an extremely high carbon price the steel industry will not be able to
develop and implement technologies for reductions beyond 19%.
The authors conclude that â€˜demand-pull measures supported by the public authorities (through CO2
prices) do not appear to be significant in bringing about changes in
the industry'. This is further illustrated by the so-called baseline
scenario, for which the study assumes a carbon price of â‚¬39/t in 2030.
In this setting the abatement potential is 11 to 14% and does not differ
significantly from the â‚¬200/t scenario.
The report confirms the reasons behind the European steel industry's
deep concerns about climate policies in the European Union: 'If an
allowance price of â‚¬200/t is not enough to bring about technologies for
meeting EU emissions targets, it is certainly more than enough to drive
the industry out of the market,' says Gordon Moffat, Director-General of
Eurofer, the European Steel Association. 'This study, carried out by
the Commission's own research body, shows that our claims about emission
targets being unachievable for the industry and a serious danger for
Europe's industrial base are more than justified. It also highlights how
the European steel industry is under constant pressure to reduce
emissions while necessary technologies to do so are unavailable.'
Carbon pricing, the JRC study proves, is ineffective for a globally
traded basic material like steel, as long as there is no international
agreement setting the same framework for the global competitors of the
European steel industry. It risks relocation of the industry to regions
outside Europe without comparable regulations.
Without a globally competitive steel industry Europe would lose the
backbone of its industrial base. Steel is indispensable for industrial
value chains and closely connected to key industry sectors. Steel is
also the basis for technologies that are urgently needed to achieve the
CO2-mitigation targets of the European Union: highly
efficient power plants, reliable supplies of renewable energies or
lightweight, fuel-efficient cars â€“ all of these rely on innovative steel
solutions for construction and production. The CO2 balance
of steel is positive in this life-cycle perspective. The amount of
emissions the material can save in application is significantly higher
than the amount emitted in the production phase.
The JRC study is available to download at:
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