Voestalpine joins the call to extend free CO2 allowances

The company believes that the phase-out schedule from 2026 to 2034 is unrealistic

Austria’s voestalpine joins 79 European industrial companies calling for the continuation of free CO2 emission allowances. This is stated in the group’s announcement.

Nearly two dozen industrial companies, representing a total of around 500,000 employees in Europe alone, have sent an open letter to politicians calling on them to abandon the planned phasing out of free allowances between 2026 and 2034 and to extend these deadlines.

As noted, on October 23, the European Council will set a decisive course for European and Austrian industry.

“If free CO2 emission allowances for industrial companies are not extended as currently planned, Europe could face serious economic and environmental problems,” the company said in a statement.

It is emphasized that voestalpine alone, which currently pays around €200 million annually for CO2 emission allowances to the Austrian budget, will have to spend an additional €1-2 billion by the end of 2030 to meet the growing demand for permits.

The consequences, the company notes, will be a loss of competitiveness and jobs for voestalpine, as well as the failure of the greentec steel transformation project.

“Further investments in transformation will no longer be economically viable. Important stages of the production process will no longer be able to take place in Austria,” said Herbert Eibenstainer, CEO of voestalpine.

According to him, the schedule for the gradual phase-out of free allowances from 2026 to 2034 is unrealistic, as the basic prerequisites for the technological transition, such as sufficient availability of green electricity or hydrogen at competitive prices, including infrastructure, will not be in place by then.

Earlier, German steel producer Thyssenkrupp called for urgent changes in EU emissions trading to prevent the bloc’s industry from falling behind its global competitors amid a slowdown in the momentum of the green transition. In particular, the company proposes a slower and non-linear reduction of quota limits in the system until 2050, their more accurate correlation with the actual pace of industrial transformation, and the continuation of free distribution after 2040.

In turn, German Economy Minister Katerina Reiche warned of the risk of losing important sectors of the country’s industry if the free allocation of CO2 emission quotas is discontinued.

As GMK Center reported earlier, in September, the Polish government proposed expanding the possibilities for importing international CO2 emission quotas in order to mitigate the pressure of rising energy and heating prices.