Europe will get rid of carbon dioxide, but problems remain
The European steel industry will have to decarbonize in the coming years, but problems remain for the successful completion of this task, according to panelists at the Kallanish Green Steel Strategies conference, which took place in Brussels on November 13.
The main obstacles, they add, are energy supply and prices, the availability of hydrogen, as well as the creation of equal conditions for all.
"The Europeans have decided that we want to get rid of carbon dioxide. As EU members, I am not against this. We cannot deny climate change," says Henrik Adam, Executive Chairman of Tata Steel Netherlands Holding BV.
One of the problems is the energy supply. Even large-scale offshore wind power is facing delays in obtaining permits, grid connections and financing, said Eldar Agayev, director of Minerals, Metals and Batteries at BNP Paribas. Nuclear facilities face the same challenges, but with additional technological difficulties.
The energy issue is also related to hydrogen, another key decarbonization material, adds Erica Mink—Zaghloul, head of government and Regulatory Affairs at thyssenkrupp Steel Europe.
Decarbonization and security should be central to policy development so that policies can cover the entire economy, including the supply of raw materials and energy, as well as end-use industries.
The panelists warn that the impact of CBAM could also lead to the deindustrialization of Europe if it is not extended to other industries. "If we don't have a steel industry, why do you need to produce cars in Europe?" Noted Adams.
However, the transition period also opens up new opportunities. "I'm a green steel optimist, but I don't wear green glasses," said Stanislav Zinchenko, CEO of the GMK Center consulting company. The prospects for small and new players in the field of environmentally friendly steel production in Europe are better than a year ago, he adds. However, major players are in no hurry to take advantage of the opportunities.
The improved forecast is partly due to the fact that over the past five years, views on the production of environmentally friendly steel have changed, says Agaev.
Recent events have made Europe much more aware of the need to avoid dependence on other regions and maintain production of key materials on the continent.
Steel companies have to adapt quickly to this new reality.
"Decarbonization strategies need to be updated," Zinchenko notes, since carbon costs will be taken into account for both domestic and imported supplies starting in 2026.