Council and European Parliament close to decision on the EU emissions trading system

The Council and the European Parliament enter into their final discussions this week on the EU emissions trading system (ETS). This is a last opportunity to modify current proposals in order to secure the global competitiveness of European industry.

Today over ten thousand steel workers are demonstrating in Brussels. They recognise that the current ETS proposals will result in heavy damage to their industry and put at risk their jobs. We share their concerns. We believe that the environmental objectives of the EU emissions trading system can be met without the hugely damaging consequences to industry of some of the provisions under discussion, notably auctioning.

“Depending on the market price of CO2, the European steel industry could face costs of 50 to 200 billion euros through the auctioning of its CO2 allowances in the third trading period from 2013-2020”, estimates Gordon Moffat, EUROFER director general (calculating a price range of 25 to 100 euro per tonne of CO2).

EUROFER asks for several provisions to be incorporated into the directive so as to prevent the de-localisation of European steel production to countries outside the EU (carbon leakage).

• Maintaining 100% free allowances for sectors at risk of carbon leakage, based on achievable benchmarks
• Maintaining fully free allowances for the energy recovery of unavoidable waste gases from the steelmaking process (about 50% of CO2 emissions from steelmaking)
• Compensation for the ETS related increase of electricity costs
• The reduction target must be based on the Kyoto reference year 1990 and not 2005

Represented by EUROFER, the European steel industry is the world leader in its sector with a turnover of EUR 140 billion and direct employment of 370 thousand people, producing 200 million tons of steel per year.

Contact

Gordon Moffat, Director General +32 2 738 79 26 (g.moffat@eurofer.be)

Axel Eggert, Director Public Affairs +32 2 738 79 34 (a.eggert@eurofer.be)