The European steel and hydrogen industries, represented by trade bodies Eurofer and Hydrogen Europe, have called on Brussels to tighten the steel public procurement rules proposed in the Industrial Accelerator Act (IAA) regulation.
Wednesday saw the long-awaited publication of the IAA legislative proposal. The European Commission (EC) proposes low-carbon requirements for public procurement and public support schemes in certain sectors, including steel, but steel is excluded from the “Made in EU” requirement.
“This measure will give investors confidence and predictability, boosting innovation and making clean steel a core part of the EU’s industrial future,” the EC states, noting the draft regulation will now be negotiated by the European Parliament and European Council before adoption.
Eurofer argues that more is needed to support green steel made in Europe, as the proposed quota does not require the low-carbon steel to be produced in the region.
“25% of public procurement represents less than 5% of the total steel market, and public support schemes vary widely across member states,” it says in a note seen by Kallanish. “Without stronger and clearer demand signals, these measures may not provide the long-term certainty needed for major industrial investments. To make lead markets work, the EU must ensure it supports low-carbon steel made in Europe, not made in third-countries.”
The association is calling for a clear definition of “Made in Europe” for steel, based on steel melted and poured in the European Union and European Economic Area. It also seeks the application of both low-carbon and European-origin criteria in the IAA; a robust labelling framework to support lead markets; and affordable electricity prices to further enable steel decarbonisation.
According to Responsible Steel, the sliding scale concept, also known as Steel Decarbonisation Scale, offers a technology-neutral approach, evaluating steel production based on greenhouse gas emission intensity and the share of scrap used.
Hydrogen Europe meanwhile says the proposal is “a step forward but lacks ambition”. Whilst it agrees that steel quotas in public procurement for buildings, vehicles and infrastructure are key to providing demand certainty, it says the 25% target will need to be raised “to create a true lead market”.
“A clear label on low-carbon steel – based on a sliding scale approach – should underpin such ambition on lead markets,” the trade body continues. “A sliding approach would help create demand for both primary and secondary steel, accounting for its carbon footprint and level of scrap recycling. But this has been delayed to later implementation under the Ecodesign framework, which gives industry and investors the wrong signal.”
Hydrogen Europe says that without a strong clean steel definition with product-based labelling and certification system, steel producers would be incentivised to maximise scrap use, which is limited by high-quality scrap availability. “For a deep transformation of the steel industry, continued investment in hydrogen-based primary steelmaking is essential,” it concludes.
