The European Commission report of 26 May highlights the relatively low costs of moving to a 30% target, but suggests that it would only have a “limited” incremental effect on carbon leakage, so long as free allowances and access to international offsets stay in place for industries such as steel. It says border adjustments would also be an option, but it would be hard to make them compatible with WTO requirements.
SBB 27 May European steel producers’ federation Eurofer has expressed relief at the decision by the European Commission not to increase its target for reducing greenhouse gas emissions.
At a feasibility study meeting yesterday, the commission decided against proposing a move from a reduction of 20% to one of 30% by 2020 compared to 1990 levels of EU greenhouse gas emissions.
Eurofer has been lobbying intensively against what it saw as a “unilateral” move that could have harmed the competitiveness of the European steel and manufacturing industries, and result in carbon leakage, as Steel Business Briefing has reported.
This could have led to production moving outside Europe while simultaneously not providing any significant improvement in carbon dioxide efficiency, argues.
However despite yesterday’s decision, the 20% reduction target will still be tough to meet, Eurofer director general Gordon Moffat claims. “This [20%] comes on top of earlier moves [to cut emissions],” he tells SBB. “It will require investment in new technology,” he adds.