Industry organisations ResponsibleSteel and the Low Emission Steel Standard (LESS aisbl) have jointly issued a new policy briefing, The Steel Decarbonisation Scale, calling for a more pragmatic and inclusive strategy for reducing emissions in Europe’s steel sector. The briefing urges EU policymakers to recognise the limitations of scrap availability and to promote decarbonisation efforts across all steel production methods.
Europe’s steel industry is a significant contributor to the region’s carbon footprint, accounting for approximately 6% of the European Union’s total emissions. With the EU committed to cutting net greenhouse gas emissions by 55% by 2030 and reaching net-zero emissions by 2050, the briefing stresses the need for clear, equitable, and effective incentives in decarbonisation efforts.
One of the report’s key messages is that current initiatives—such as the European Steel and Metals Action Plan (ESMAP) and emerging voluntary carbon labelling proposals—could fall short if they rely too heavily on scrap-based production without acknowledging supply constraints. According to the International Energy Agency (IEA), although steel recycling rates are high (around 85%), only 32% of global steel demand can currently be met using scrap due to the long lifecycle of steel products. By 2050, this figure is expected to rise to just 46%.
“Scrap is a valuable but limited resource,” said Dr. Martin Theuringer, Secretary General of LESS aisbl. “A decarbonisation framework that overlooks this risks distorting markets and failing to deliver real emissions reductions. What we need is an approach that drives progress across all types of steel production.”
To address this, the organisations propose the adoption of a “steel decarbonisation scale,” which complements traditional carbon accounting by factoring in the ratio of scrap to primary iron used in steelmaking. Already recognised in international policy discussions, including by the G7, this approach is designed to:
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Avoid unsustainable competition over limited scrap supplies
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Encourage emissions reductions across both primary and secondary steel production routes
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Align with World Trade Organization (WTO) principles and support technology-neutral solutions
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Strengthen the competitiveness of European industry while advancing global climate goals
“A European steel label could become a powerful tool for promoting real progress in decarbonisation,” said Annie Heaton, CEO of ResponsibleSteel. “But to be effective, it must reflect the reality that recycled scrap alone cannot meet future demand. By incorporating scrap content into the assessment of carbon intensity, the steel decarbonisation scale can help guide investment where it’s most needed.”
ResponsibleSteel and LESS are encouraging the European Commission to incorporate the proposed scale into the design of voluntary labelling schemes, market incentives, and industrial policy frameworks to ensure future measures are equitable, effective, and climate-aligned.
