Europe’s largest steelmaker, ArcelorMittal, announced this morning that it would further delay its decarbonisation pledge, namely through the delay of its direct reduced iron (DRI) projects across Europe. The European Environmental Bureau (EEB) and Climate Action Network (CAN) Europe strongly condemn this setback, as renewables-based DRI represents one of the most effective technologies at hand to help decarbonise this crucial sector. 

Quotes

Riccardo Nigro, Senior Policy Officer for Zero Pollution Industry at EEB, says:

“ArcelorMittal has pledged to transition away from coal towards climate-compatible steel production processes and has already secured €3 billion in public aid to do so. Yet, now it’s holding back on delivering. Demanding even more political and financial support without clear commitments in return is nothing short of blackmail under the guise of competitiveness. Europe’s steel transformation must move forward without delay, the path is clear. Member States and the EU must not bow to pressure from transition laggards, as renewables-based steelmaking is already on track. Any setback would only put Europe at a competitive disadvantage in a rapidly evolving global market.”

Boris Jankowiak,  Steel Transformation Policy Coordinator at CAN Europe, says:

“ArcelorMittal’s announcement to delay final investment decisions in less carbon-intensive steelmaking is unacceptable. It puts the EU leadership on green industrial transformation at risk, as only a decarbonised steel industry can be competitive and future-proof. Asking the Commission to reveal all their cards before taking any steps forward is not fair play, although it is not the first time that the company pulls out of subsidised projects. Primary steelmakers have received positive signals during the recent Commissioner-designates’ hearings. The new Commissioners have been lending a listening ear to the industry’s grievances, committing to work on green lead markets for steel, and on a steel and metals action plan.

Additionally, the steel industry has already obtained regulatory flexibilities and support in the last EU cycle via the gradual phase out of free allocations and the review of the carbon border adjustment mechanism. We don’t need a capital strike – we need capital investments from our most carbon-emitting industry, especially since ArcelorMittal has already secured around 3 billion euros of public money for its decarbonisation projects in Belgium, France, Germany and Spain, to make the transformation a reality. Delaying the transition until the regulatory framework matches ArcelorMittal’s terms leaves workers and local communities stranded in limbo and makes us lose precious time to ensure a competitive steel industry compatible with a 1.5 degrees’ scenario,”

Why does this matter?

• ArcelorMittal talks the talk when it comes to decarbonisation, but it has yet to truly walk the walk. The company pledged to reduce CO₂ emissions by 35% in its European operations by 2030 and achieving carbon neutrality by 2050. To support these goals, ArcelorMittal announced significant investments across Europe. So far, €3 billion in public aid has already been secured for this. However, on Tuesday morning, 26 November 2024, ArcelorMittal announced that it would delay its DRI projects across Spain, France, Belgium and Germany.

• These postponements raise serious concerns about the company’s decarbonisation commitment and the broader implications for Europe’s steel industry’s transition to greener production methods. Renewables-based steel is the answer to the current steel crisis. By allowing companies to backtrack in this way, the EU is missing its green steel “moment”. While other EU steelmakers are still moving ahead (SHS, Salzgitter, Stegra) and showing the transition can be done, allowing big players like ArcelorMittal to backtrack puts the EU at risk of losing out to other geographies, such as Australia and China.

• Investing in renewables-based steel today is a strategic move that secures our leadership in a rapidly evolving global market. By boosting energy efficiency, increasing scrap usage, and scaling up renewable hydrogen-powered DRI steel production now, Europe is positioning itself as the preferred supplier for companies seeking to align with these sustainability goals, giving us a significant competitive edge. Delaying this transition not only jeopardises our ability to meet this growing demand but also risks losing ground to global competitors who are already advancing in this space. The world will not wait for Europe to catch up; leadership requires action today, and renewable-based steel is the foundation for our future competitiveness, innovation, and economic resilience.

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