European Parliament Demands Technically, Economically Feasible Energy Targets for Europe’s Steelmakers
02/05/2014 - On 4 February 2014, the European Parliament adopted with a huge majority a resolution on the EU’s Action Plan for a Competitive and Sustainable Steel Industry in Europe (adopted with 505 against 95 votes).
Gordon Moffat, EUROFER director general, commented: “We welcome the strong message that today has been sent by the European Parliament to the Commission and the heads of state and governments in view of the EU summit in March which is dedicated to industrial competitiveness and the EU climate and energy policy for the years up to 2030. The parliamentarians recognize that there needs to be a real balance between climate policy and industrial competitiveness.”
Parliament’s resolution acknowledges that the steel sector forms “the basis for the generation of European industrial value added and has a strategic importance for several major European industries, such as terrestrial and naval transport, construction, machinery, electrical household appliances, energy and defense.” It stresses that “sustainable growth depends on a strong European industry, and therefore urges the Commission and the Member States to support the strategic development of key steel-using sectors. It acknowledges that steel products play an important role in enabling the transition to a knowledge-based, low-carbon and resource-efficient economy.” The European Union should promote a policy of developing industrial production in all the Member States, in order to safeguard jobs within the EU and ensure that the current share of industry of 15.2 % of GDP rises to at least 20 % by 2020.
The “EU environment and energy policy create a difficult business environment for the iron and steel industry, in particular in raising the price of energy and making EU manufacturing uncompetitive on the global market”, the parliamentarians say. “Energy prices in the EU have risen sharply in recent years, resulting in a marked deterioration in the global competitiveness of the industry in the EU.”
The resolution “urges the Commission to adopt a holistic approach to climate change, environment, energy and competitiveness policy taking into account sectoral specificities. The Commission should address more concretely and in detail the issue of carbon leakage:
• “The 2030 climate and energy policy targets must be technically and economically feasible for EU industries.”
• “Best performers should have no direct or indirect additional costs resulting from climate policies.”
• “The provisions for carbon leakage should provide 100% free allocation of technically achievable benchmarks, with no reduction factor for carbon leakage sectors.”
• “Encourages the Commission to develop strategies for the deployment of low-carbon energies in a cost-effective way and gradually phasing out subsidies, so as to foster the rapid integration of such forms of energy into the electricity market. In the meantime, offsetting the costs of the overall electricity surcharges for energy-intensive industries should be possible if these are costs which competitors outside the EU do not have to bear.”
The Members of the European Parliament are also “concerned about the impact which the recent Commission Decision on Member States’ national implementation measures (NIMs) for the third emissions trading period may have on industry through the application of the cross-sectoral correction factor, which demonstrates that for industry the target is not achievable even with the best available technologies currently applied in Europe, with the result that even the most efficient installations in Europe may have additional costs.”
They “support the Commission’s promise to step up efforts to decrease the energy price and cost gap between the EU industry and its main competitors.” The Commission should come forward within 12 months with concrete proposals to this end. “When regulating, the Commission should look for synergies that will allow the achievement of climate and energy targets while supporting the goals of competitiveness and employment and minimizing the risk of carbon leakage and relocation.”
Represented by EUROFER, the European steel industry represents the world leader in its sector, producing on average 170 million tonnes of steel per year with direct employment of 350,000 highly skilled people. More than 500 steel production and processing sites in 24 EU member states provide direct and indirect employment for millions of European citizens.
Parliament’s resolution acknowledges that the steel sector forms “the basis for the generation of European industrial value added and has a strategic importance for several major European industries, such as terrestrial and naval transport, construction, machinery, electrical household appliances, energy and defense.” It stresses that “sustainable growth depends on a strong European industry, and therefore urges the Commission and the Member States to support the strategic development of key steel-using sectors. It acknowledges that steel products play an important role in enabling the transition to a knowledge-based, low-carbon and resource-efficient economy.” The European Union should promote a policy of developing industrial production in all the Member States, in order to safeguard jobs within the EU and ensure that the current share of industry of 15.2 % of GDP rises to at least 20 % by 2020.
The “EU environment and energy policy create a difficult business environment for the iron and steel industry, in particular in raising the price of energy and making EU manufacturing uncompetitive on the global market”, the parliamentarians say. “Energy prices in the EU have risen sharply in recent years, resulting in a marked deterioration in the global competitiveness of the industry in the EU.”
The resolution “urges the Commission to adopt a holistic approach to climate change, environment, energy and competitiveness policy taking into account sectoral specificities. The Commission should address more concretely and in detail the issue of carbon leakage:
• “The 2030 climate and energy policy targets must be technically and economically feasible for EU industries.”
• “Best performers should have no direct or indirect additional costs resulting from climate policies.”
• “The provisions for carbon leakage should provide 100% free allocation of technically achievable benchmarks, with no reduction factor for carbon leakage sectors.”
• “Encourages the Commission to develop strategies for the deployment of low-carbon energies in a cost-effective way and gradually phasing out subsidies, so as to foster the rapid integration of such forms of energy into the electricity market. In the meantime, offsetting the costs of the overall electricity surcharges for energy-intensive industries should be possible if these are costs which competitors outside the EU do not have to bear.”
The Members of the European Parliament are also “concerned about the impact which the recent Commission Decision on Member States’ national implementation measures (NIMs) for the third emissions trading period may have on industry through the application of the cross-sectoral correction factor, which demonstrates that for industry the target is not achievable even with the best available technologies currently applied in Europe, with the result that even the most efficient installations in Europe may have additional costs.”
They “support the Commission’s promise to step up efforts to decrease the energy price and cost gap between the EU industry and its main competitors.” The Commission should come forward within 12 months with concrete proposals to this end. “When regulating, the Commission should look for synergies that will allow the achievement of climate and energy targets while supporting the goals of competitiveness and employment and minimizing the risk of carbon leakage and relocation.”
Represented by EUROFER, the European steel industry represents the world leader in its sector, producing on average 170 million tonnes of steel per year with direct employment of 350,000 highly skilled people. More than 500 steel production and processing sites in 24 EU member states provide direct and indirect employment for millions of European citizens.
