European steel producers have campaigned hard against the European Commissions proposed emissions benchmarks. Now Eurofer intends to launch a legal challenge in what may prove to be a final attempt to oppose them.
SBB 5 April European steel producers’ federation Eurofer has commenced legal proceedings against the European Commission’s (EC) benchmarks for carbon dioxide emissions. It will go to court if the benchmarks are adopted by the EC in mid-April, it tells Steel Business Briefing.
The benchmarks will set the number of free carbon credits steelmakers will receive in 2013-2020. For emissions over this level, companies will have to provide their own credits. The low level of the benchmarks could add €5bn to the €6bn cost of the Emissions Trading System for steel companies, Eurofer says.
The benchmarks are technically unachievable by even the most efficient integrated steelmakers, Eurofer complains. The best performing facilities in industries subject to international competition should receive free carbon credits to cover their emissions, says Eurofer director general, Gordon Moffat.
The EC is confident that it can defeat any legal challenge, a spokesman for its climate action unit tells SBB. The reason the benchmarks are lower than steelmakers would like is related to the use of blast furnace waste gases to generate electricity. Power companies will not receive any free credits in 2013-2020 while the steel industry will receive credits to cover 85% of the carbon dioxide in waste gases used to generate electricity, the spokesman points out. When the benchmarks come into effect in 2013, the steel industry could have 370m spare allowances to use in 2013-2020, he adds