Publications » Position papers » Creating markets for low CO2 materials: Sector coupling via lifecycle CO2-credits for the use of low-CO2 steel as 'eco-innovations' in the automotive industry
Creating markets for low CO2 materials: Sector coupling via lifecycle CO2-credits for the use of low-CO2 steel as 'eco-innovations' in the automotive industry
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The European Green Deal emphasizes the will of the European Union to become the first climate neutral continent by 2050. Important decisions have to be taken very soon for the phase until 2030 for the deployment of the first low-carbon breakthrough technologies on industrial scale, especially in energy-intensive sectors.
The steel industry as well as other basic materials industries need to go through a major transformation process to meet the EU climate objectives. Fulfilling the targets is challenging but technically possible, e.g. via hydrogen-based steelmaking, carbon capture and utilisation/storage, process integration, and utilisation of steel recycling within the limits of scrap availability.
However, despite the high CO2 reduction potential, companies still face huge barriers in terms of commercialisation. Estimations show that the production costs of low-carbon breakthrough technologies will increase significantly under the current political framework, making it impossible for domestic companies to compete on the world market against companies which do not have to undergo climate-related transformational processes.
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A milestone occasion to quickly and effectively restore affordable electricity, to relaunch the
decarbonization and strengthen the international competitiveness of the European steel
industry.
Brussels, 02 December 2025 – Unchanged negative conditions – U.S. tariffs and trade disruptions, economic and geopolitical tensions, protracted weak demand and still high energy prices – continue to weigh on the European steel market. EUROFER’s latest Economic and Steel Market Outlook confirms for 2025 another recession in both apparent steel consumption (-0.2%, unchanged) and steel-using sectors (-0.5%, revised from -0.7%). A potential recovery is expected only in 2026 for the Steel Weighted Industrial Production index (SWIP) (+1.8%, stable) and for apparent steel consumption (+3%, slightly revised from +3.1%) – although consumption volumes would still remain well below pre-pandemic levels. Steel imports retained historically high shares (27%), while exports plummeted (-9%) in the first eight months of 2025.
Fourth quarter 2025 report. Data up to, and including, second quarter 2025