EU policy could accelerate decline in foundry production – Federacciai president

The EU’s current climate policy risks accelerating the collapse of blast furnace steel production in the bloc, which will face a combination of CBAM and the gradual phasing out of free CO2 emission allowances. This was stated by Antonio Gozzi, president of the Italian steel producers’ association Federacciai, at the organization’s annual meeting, Kallanish reports.

Without free CO2 emission allowances, European blast furnaces are doomed to closure due to prohibitive additional production costs, he warned.

Federacciai also stresses the urgent need to rethink global trade rules so that they are truly aimed at fair competition.

In addition, the president of Federacciai, according to HydroNews, believes that hydrogen is not a solution for decarbonizing the steel industry, at least for now. In his opinion, the cost of green hydrogen has not yet reached acceptable levels.

In addition, the technology has bottlenecks, in particular, the use of valuable resources (renewable energy and water) in electrolysers, which have an efficiency of 50%. Gozzi is convinced that it is more logical to use green energy directly in electric arc furnaces, which have an efficiency of 95%.

Gozzi added that most hydrogen projects in steel industry, financed by the EU and member states, have reached a dead end. However, he does not reject the idea of green hydrogen, emphasizing that it might make sense to produce it in countries with a surplus of renewable energy, thereby reducing costs.

It should be recalled that Federacciai supported the Italian government’s position on the European Green Deal. The federation believes that decarbonization should be supported with instruments that correspond to economic realities.