ArcelorMittal is pressing the Government of Spain to adopt measures that would align its energy costs with those faced by other European steelmakers. The company points to France and Germany as examples where electro-intensive industries enjoy more stable and predictable pricing. Spanish leadership warns that without government action, industrial facilities could halt operations and ERTE procedures could become common, at best.
The warning is part of ArcelorMittal’s analysis of Spain’s steel sector, documented in its Sustainability Report for 2021. Rising production costs from the non-EU import rights system, soaring raw material prices, and CO2 costs are described as having a profound impact on the sector’s vitality. When added to a weak auto market that contracted due to semiconductor shortages, the industry faces ongoing decarbonisation challenges.
Despite a modest 12% recovery in steel demand in Spain during 2021, the overall level remains below what was seen before the health crisis. The management notes that the early signs of recovery have stalled. Short-term production and demand have been dampened by the war in Ukraine and the industry’s dependence on the auto sector and construction activity remains a key driver for future demand.
energy price
ArcelorMittal stresses that the war has intensified the issue of high energy costs. The Electrointensive Consumer Regulation in Spain, approved by the government, is seen as failing to guarantee stability, security, or predictable prices for energy. The policy is viewed as not adequately protecting competition or attracting industrial investments like ArcelorMittal.
Government efforts to prepare an energy-saving plan are noted, but the company argues there is no clear supply risk. The sentiment is that recent price spikes in gas, oil, and CO2 rights from late 2021 into 2022 have triggered an energy crisis. When costs approach peaks, plant shutdowns become likely, with ERTEs as a possible consequence. A stop in Asturias last March is cited as an example, coinciding with electricity price pressures and a transport strike.
The company has informed workers’ representatives of plans to negotiate ERTEs for temporary workforce adjustments driven by production needs. Such measures echo a previously used approach that was not renewed due to disagreements with some unions.
electro-intensive
ArcelorMittal notes that the steel sector, like many others in Spain, operates in an electro-intensive regime facing inflated electricity costs. Gas and oil price increases have amplified the burden in recent years. The company advocates for a package of government measures to bring Spain in line with other European producers so that competition remains level. Proposed steps include higher indirect CO2 cost compensation, greater use of renewable sources in the energy mix, and a reform of the marginal electricity market. A key goal is to separate fossil fuel prices from electricity costs in the market while the energy crisis persists.
These points are framed as a call for policy adjustments that would help the electro-intensive sector remain viable and attract investment, ensuring a fair competitive landscape with European peers.
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The company compares Spain with France, where an electro-intensive energy plan provides a stable electricity price and some costs are insured. In Germany, large electricity consumers benefit from a regulated cost exemption system and other support mechanisms that help sustain industrial activity and competitiveness. The Spanish steel industry is described as facing a mismatch between policy support and the needs of a modern, energy-intensive production base.
La Nueva España’s reporting is cited to illustrate that electricity prices could render decarbonization investments impractical. The planned electric arc furnace and the DRI-based facility at the Gijón plant would consume electricity at a substantially higher rate, underscoring the urgency for a stable energy framework.