Stefan Rauber, CEO of the steel producers Saarstahl and Dillinger Hütte, issued a warning against the proposed reforms to the EU Emission Trading System (ETS), stating that weakening Europe’s most crucial climate protection instrument could have significant negative consequences. Rauber told Spiegel that if industries fail to transform, they may continue to operate using CO₂-intensive methods “for longer and cheaper.” This lack of transformation also makes the purchase of green steel less appealing to customers.
The Saarstahl CEO specifically fears that the planned regulatory shifts could jeopardize the development of a hydrogen economy. He warned that “the weaker the emissions trading becomes, the less attractive investments into hydrogen production will be.” For the companies, this presents a clear risk: a reduction in vendors and higher overall costs. Both Saarstahl and Dillinger Hütte are implementing a climate-friendly conversion of their steel production, backed by state funding, with a massive €4.6 billion investment. This investment planning was based on the assumption of continuously rising CO2 prices.
The EU Commission is anticipated to propose ETS reforms on July 17 to alleviate the pressure on businesses struggling with high operating costs. Among the points under discussion is whether the reduction of new emission allowances should be as swift as originally planned.
As a potential counterbalance, Brussels has considered providing early-adopter companies with additional carbon certificates. If they do not require these certificates, they could subsequently resell the allowances to other operations that produce more carbon. However, Rauber criticized this approach, pointing out that given the fluctuating market prices, the value of such compensation would be almost impossible to forecast. “Theoretically, it sounds good,” he stated, “but in practice, it would simply be a stock market gamble. We would be left bearing the risk that the CO2 price falls instead of continuing to rise.”
