The fate of the European steel industry could be decided this year amid the green steelmaking transformation, ArcelorMittal Europe chief executive Geerd Van Poelvoorde said at the annual “Zukunft Stahl” conference in Germany this week.

The event, organised by business daily Handelsblatt in Düsseldorf, was monitored by Kallanish.

“However, the European Commission is slowing decarbonisation efforts with its bureaucracy,” Van Poelvoorde noted. “The previous plans in Brussels were not sufficient to ensure the future viability of the steel industry. The European Union has to decide how it will act to achieve better results in decarbonisation.”

According to Van Poelvoorde, in 2021, CO2 prices tripled, as did electricity and natural gas prices, which makes the transformation to direct reduced iron-electric arc furnace route production unprofitable for the moment. “Green steel, made with hydrogen instead of carbon, is currently the hot topic in the industry, but H2 production is too expensive for the moment,” he added.  

Green steel is more expensive than conventionally produced steel. Calculations by Accenture estimate that car production costs will increase by between €500 and €1,000 ($568-1,136) per vehicle, and washing machine production costs by around €30. “The companies would have to find out how they can compensate these additional prices,” Accenture managing director Gerd-Michael Hüesken said at the event.

The production of low-CO2 steel in EAFs is another goal of the industry, observed Georgsmarienhütte chief executive Alexander Becker. “The biggest lever for pushing the numbers further is the expansion of renewables. We really hope that the new German government will do everything in its power to achieve its goals, courageously and vigorously."