Policy crunch points to decarbonising European steel

Policy crunch points to decarbonising European steel | Research Square window.SnipcartSettings = { analytics: { enabled: false } }; (function() { var accessVector = localStorage.getItem('access_vector') || ''; window.dataLayer = window.dataLayer || []; if (accessVector) { window.dataLayer.push({ user: { profile: { profileInfo: { snid: accessVector } } } }); } })(); (function(w,d,s,l,i){w[l]=w[l]||[];w[l].push({'gtm.start':new Date().getTime(),event:'gtm.js'});var f=d.getElementsByTagName(s)[0],j=d.createElement(s),dl=l!='dataLayer'?'&l='+l:'';j.async=true;j.src='https://www.googletagmanager.com/gtm.js?id='+i+dl;f.parentNode.insertBefore(j,f);})(window,document,'script','dataLayer','GTM-K279D39R'); Browse Preprints In Review Journals COVID-19 Preprints AJE Video Bytes Research Tools Research Promotion AJE Professional Editing AJE Rubriq About Preprint Platform In Review Editorial Policies Our Team Advisory Board Help Center Sign In Submit a Preprint Cite Share Download PDF Research Article Policy crunch points to decarbonising European steel Sebastian Osorio, Frank Best, Darius Sultani, Michael Pahle This is a preprint; it has not been peer reviewed by a journal. https://doi.org/ 10.21203/rs.3.rs-7811341/v1 This work is licensed under a CC BY 4.0 License Status: Posted Version 1 posted You are reading this latest preprint version Abstract Decarbonising the European steel sector is pivotal for achieving the EU’s climate targets due to its significant emissions and central role in the economy. Technologically, decarbonisation will be accomplished by phasing out coal-based steelmaking and shifting toward cleaner technologies such as electric arc furnaces and hydrogen-based direct reduced iron. However, policy makers are confronted with three crunch points that endanger political feasibility: High costs, relocation risks, and declining demand pose key challenges. Using the LIMES-EU model, we find that uniform carbon prices could drive future steel production away from traditional centres toward regions with lower energy costs. While this shift lowers costs and emissions, it may trigger political resistance and could provoke protective subsidies for national steel capacities. Government intervention could slow down the sector’s transition and increase public spending. These effects become more pronounced if future demand for EU steel declines. Environmental Economics Energy Engineering Environmental Policy Energy System Modelling Energy-intensive industries Steel Sector Decarbonisation Green Steel Industrial Transition European Union Emissions Trading System (EU ETS) Full Text Additional Declarations The authors declare no competing interests. Supplementary Files Osorioetal2025SupInformationPolicycrunchpointstodecarbonisingEuropeansteel.pdf Supplementary Information: Policy crunch points to decarbonising European steel Cite Share Download PDF Status: Posted Version 1 posted You are reading this latest preprint version Research Square lets you share your work early, gain feedback from the community, and start making changes to your manuscript prior to peer review in a journal. As a division of Research Square Company, we’re committed to making research communication faster, fairer, and more useful. We do this by developing innovative software and high quality services for the global research community. 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Also discoverable on Platform About Our Team In Review Editorial Policies Advisory Board Help Center Resources Author Services Accessibility API Access RSS feed Manage Cookie Preferences © Research Square 2026 | ISSN 2693-5015 (online) Privacy Policy Terms of Service Do Not Sell My Personal Information {"props":{"pageProps":{"initialData":{"identity":"rs-7811341","acceptedTermsAndConditions":true,"allowDirectSubmit":true,"archivedVersions":[],"articleType":"Research Article","associatedPublications":[],"authors":[{"id":526745799,"identity":"4f654b1d-8091-4f63-8674-1c1865a8fc38","order_by":0,"name":"Sebastian 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