The European Commission has confirmed its Industrial Accelerator Act (IAA) legislative proposal includes a stipulation that 25% of steel volume procured for public projects launched from 2029 must be low-emission. However, given the forthcoming new steel trade regime, a “made in EU” requirement has not been included, and neither has the voluntary label for low-emission steel.
For public procurement and other projects that require some form of public intervention, the volume of steel, and any product the performance of which depends mainly on steel, will need to comprise minimum 25% low-emission material. This will be effective for projects launched and schemes updated or established from 1 January 2029.
However, contrary to aluminium and cement, the proposed made in EU mandate for public procurement is not included for steel. “In light of the recently proposed trade measure addressing the negative trade-related effects of global overcapacity on the Union steel market, introducing a European preference for steel is not considered necessary,” the Commission says in a document seen by Kallanish.
The legislation proposal also does not follow the preferred policy option to adopt a voluntary steel label in support of low-carbon steel investment decisions.
Instead, the forthcoming delegated act on steel products under the Ecodesign for Sustainable Products Regulation (ESPR) will provide the necessary elements to implement the lead market provisions for steel. This is “taking into account the differing decarbonisation characteristics of primary and secondary steel producers and rewarding circularity,” the Commission notes.
“In designing labelling and information requirements based on performance thresholds for different products, such thresholds should take account of the recycled content of the industrial product, the threshold decreasing with the increase of recycled content in the products, where relevant,” it adds.
The IAA aims to increase the manufacturing sector’s share of EU GDP to 20% by 2035, compared with 14.3% in 2024.
It also proposes to amend conditions for major investments in strategic sectors exceeding €100 million ($116m) where a single third country controls more than 40% of global manufacturing capacity. These will include the need for technology transfer, 50% of staff being EU based, foreign participation being limited to 49%, and 1% of turnover being invested in EU research & development.
It aims to streamline and digitalise permitting procedures for industrial projects, including tacit approval at intermediate stages of the permit-granting process for energy-intensive decarbonisation projects. The creation of "Industrial Acceleration Areas" will facilitate essential energy infrastructure investments, the Commission says.
The proposed regulation must now be negotiated by the European Parliament and Council before its adoption and entry into force.
Outokumpu was one of the first steelmakers to react to the proposed legislation, welcoming the measure but urging the Commission to introduce an EU low-carbon steel label and expand the made in EU requirement to also include steel (see separate story).
Source:Kallanish
