The European Commission (EC) has introduced an action plan to maintain and expand the industrial capacities of the steel and metals sectors in Europe.
The initiative seeks to enhance the competitiveness of the sectors and secure their future, acknowledging their critical role in the economy and their importance for the EU’s security, particularly in the current geopolitical context.
Go deeper with GlobalData
The steel and metals industry is at a pivotal juncture, grappling with high energy costs, global competition and the necessity for investments to lower greenhouse gas emissions.
The European steel industry, with around 500 production sites in 22 member states, adds around €80bn ($87.4bn) to the EU’s gross domestic product.
The action plan on steel and metals arrives amidst market-distorting measures such as non-market support for global overcapacities and tariffs on EU steel and aluminium, which threaten to adversely affect the European economy.
The EC’s plan includes strategies to ensure a secure and affordable energy supply, prevent carbon leakage, protect and expand industrial capacities, promote circularity, de-risk decarbonisation and safeguard quality industrial jobs.
The EC is advocating for the use of power purchase agreements and encouraging member states to use energy tax flexibility and reduced network tariffs to mitigate electricity price volatility.
It also supports faster grid access for energy-intensive industries and the increased use of renewable and low-carbon hydrogen.
The EC will issue a communication in the second quarter of this year on how to address the issue of carbon leakage for carbon border adjustment mechanism (CBAM) goods exported from the EU.
It is also set to propose a new long-term measure to protect the EU’s steel sector after the current safeguard expires in mid-2026.
EC President Ursula von der Leyen said: “The steel industry has always been a core engine for European prosperity. Next-generation, clean steel should therefore continue to be manufactured in Europe. That means we have to help our steelmakers who are facing strong headwinds on the global market.
“To make sure they remain competitive, we must reduce energy costs and help them introduce innovative, low-carbon technologies to the market. With today’s Action Plan we are offering concrete solutions for a thriving European steel industry.”
Improving recycling is another focus, with the EC planning to set targets for recycled steel and aluminium and considering trade measures on metal scrap.
The future Industrial Decarbonisation Accelerator Act will promote low-carbon metals in public procurement, and significant funding will be allocated for research and development into decarbonisation.
The plan also recognises the industry’s role in employment, supporting nearly 2.6 million jobs. It will implement active labour policies for skills development and fair job transitions, overseen by the European Fair Transition Observatory and the Quality Jobs Roadmap.
The action plan for steel and metals complements the Clean Industrial Deal and the Action Plan for Affordable Energy.
It follows a strategic dialogue led by the president of the commission and the executive vice-president in charge of Prosperity and Industrial Strategy. It is the second sector-specific plan after the automotive industry action plan presented on 5 March 2025.
