Green steel labelling debate in Europe: EAF producers push back
European scrap processors and EAF steel producers have written to the European Commission objecting to a one-size-fits-all sliding scale label, arguing it fails to recognise the low CO2 profile of Europe's EAF industry.
Recycling Europe (formerly the Euric association), EAF steel producers such as Aperam, Pittini, Sidenor, Ovako, Megasa, Duferco, and Feralpi, and major scrap dealers including Galloo and Derichebourg, wrote a letter to the European Commission (EC) raising objections.
They recommend that the Commission avoid applying a single sliding-scale label across all steel production processes, arguing that such a system would fail to account for the low CO2 profile of Europe's EAF industry. This industry's output accounts for approximately 45% of EU steel production and is already largely electric, circular, and low-emission.
The sliding scale concepts were primarily developed for coal-based primary steel production. Applying the same metric to electric arc furnace production could be inefficient and distort competition by favouring higher-emission imports.
The letter, obtained by Kallanish, states: "We find it difficult to believe that the European Commission would pursue such an unbalanced and discriminatory policy while being unaware of the devastating consequences it would create for half of the EU steel industry and the value chain. Furthermore, we do not believe the Commission would ignore the political and legal challenges such a policy would inevitably face."
The signatories warn that a "one-size-fits-all" label would fail to reflect the different challenges faced by the BF-BOF and EAF routes and could lead to inconsistent policy outcomes across markets. They add that the initiatives shaping the sliding scale methodology have so far consulted almost exclusively with primary producers, leaving the recycling segment insufficiently represented.
Europe's dependence on imported raw materials could increase
The signatories warn that misaligned criteria could lead EU EAF production to be displaced by high-carbon primary steel from abroad, which would increase Europe's dependence on imported raw materials and undermine decarbonisation targets. They call for a more balanced approach that aligns with existing carbon footprint methodologies and combines both circularity and decarbonisation. They add that they are ready to work with policymakers to ensure that future frameworks support Europe's climate goals while also preserving the competitiveness of the recycling-based steel value chain.