More EU end users criticise safeguard proposal

This week the association dedicated to represent the interests of the European wind-energy sector, WindEurope, has criticised the European Commission (EC) proposal on the permanent safeguard measures on imports of steel products. The statement came as EU member countries are to begin discussing and voting on the proposal on Wednesday 16 January, Kallanish notes.

“It’s good the Commission has opted for an annual increase in the steel import volumes. But 5% is very low: we expect demand for steel in offshore wind alone to rise by 36% in 2019. It’s in nobody’s interest for access to steel volumes to turn into a scramble for raw materials with other sectors like we’re all chasing seats in musical chairs. Not least when our own sector has binding EU renewables targets it’s got to help meet,” WindEurope ceo Giles Dickson says in the statement.

“If we have to pay tariffs on our steel imports the price of wind energy will increase. Steel makes up over half the material used in wind turbine production. Tariffs could add 18% to the price of turbines. This would offset the cost reductions we’ve achieved in recent years. And mean achieving the EU’s 32% renewable energy target for 2030 will cost society more than is necessary,” he adds.

WindEurope notes that the increase of steel prices linked to difficulties in importing materials will create a disadvantage for European manufactured goods against, for example, Chinese competitors. This mirrors the concerns already raised by other sources in in contact with end-users in the market.

“We call on European countries and the Commission to agree a higher annual rate of increase in non-tariff volumes than the proposed 5% when they vote on Friday,” WindEurope concludes.

Similar concerns have been issued, for example, by the European carmakers’ association, ACEA. It is unlikely that the EC proposal will be changed drastically. The issues raised by European steel end-users however could well force the EC to agree to further increase the tariff-free quotas proposed or at least to organise them in a different way.