At the stage of transformation, the country's steel sector needs active political steps

Small and medium-sized steel companies (SMEs) in Germany need competitive electricity prices and simplified subsidy conditions. This was discussed at a meeting between the German steel association WV Stahl and officials from the states of Saxony and Thuringia.

According to Bernhard Osburg, President of WV Stahl, active political measures are urgently needed at the critical stage of transformation for the industry, especially to ensure the competitiveness of medium-sized steel companies.

«The urgent challenges we face require decisive action. In particular, we need a decision on competitive electricity prices and, most importantly, the restoration of subsidies to stabilize electricity transmission tariffs,» he said.

Medium-sized companies produce steel exclusively through the energy-intensive electric arc furnace process. In Germany, this process accounts for almost 30% of steel production and plays a key role in the circular economy and climate protection.

However, these companies are currently facing major challenges, such as high energy costs compared to the international market, unfair imports due to global overcapacity, and a weakening German economy.

At the meeting, WV Stahl presented a position paper that reinforces the areas of action mentioned in the January resolution of the Stahlallianz (Steel Alliance), formed by the country’s steel regions, and formulates the most urgent measures needed to maintain the international competitiveness of this production route and its transformation.

These include:

  • reducing the cost of electricity, in particular, due to the massive increase in transmission tariffs since the beginning of the year;
  • ensuring access to green electricity by accelerating the development of renewable energy sources and infrastructure;
  • adapting the system of state subsidies to support transformational investments;
  • providing hydrogen infrastructure for climate neutrality of the electric steel route;
  • ensuring the availability of scrap of the required quality.

«The electric steel industry is not only an important employer but also a central building block for the decarbonization of the German steel industry and contributes to the resilience of the German economy,» WV Stahl said.

As GMK Center reported earlier, ArcelorMittal calls on the German authorities to adopt a clear industrial policy to continue the green transformation of its assets in the country. Competitive energy prices are a crucial factor for the group’s final investment decision worth €2.5 billion.