ArcelorMittal Delays Green Steel Plans Amid Policy Uncertainty

Policy Challenges and Setback for Green Steel Projects
ArcelorMittal’s decision to delay its transition to hydrogen-based green steel production has raised concerns across the European industrial landscape. The company cited significant uncertainties around the EU’s carbon border adjustment mechanism (CBAM) as a key factor behind this pause. The CBAM, designed to shield European producers from competition with regions that have looser environmental regulations, has been criticized by ArcelorMittal for its “weaknesses,” making the policy environment unpredictable. This uncertainty has prompted the steel giant to hold off on finalizing investment decisions for its green steel plants across Europe.

Despite receiving billions in state financial support from various European nations—including €1.3 billion from Germany, €850 million from France, and €460 million from Spain—ArcelorMittal emphasized that it could not proceed with critical investments unless there is clearer policy guidance. This delay marks a significant setback for Europe’s ambitious plans to decarbonize its steel industry and position itself as a global leader in green manufacturing.

Industry Response and Calls for Stronger EU Policies
The Renewable Hydrogen Coalition has expressed alarm over the delay, viewing it as a serious blow to Europe’s efforts to decarbonize its steel sector. According to the coalition, renewable hydrogen, combined with renewable electricity, is essential for achieving a competitive and decarbonized European steel industry. Campaigners have urged the EU to close the policy gap and provide clearer signals to ensure the continued momentum of the green transition.

On the other hand, Hydrogen Europe, which advocates for hydrogen as a key enabler of green energy solutions, has taken a more measured view. The organization acknowledged that delays are common in emerging industries and emphasized the importance of simplifying regulatory frameworks to accelerate the pace of implementation. Hydrogen Europe’s CEO, Jorgo Chatzimarkakis, also highlighted the growing pipeline of large-scale hydrogen projects that could benefit from improved market conditions.

EU Commission’s Green Industrial Strategy at a Crossroads
ArcelorMittal’s decision to pause its green steel plans signals the urgent need for robust and supportive policies from the EU Commission, which is currently preparing to unveil its Clean Industrial Strategy. As the EU works to achieve its climate goals, steelmakers like ArcelorMittal and SSAB (Swedish steelmaker) are calling for clearer policy mechanisms, including carbon pricing and near-zero emission standards, to provide long-term stability and foster investments in green technologies. SSAB, for instance, has stressed the need for common near-zero emission standards and the gradual phase-out of free emissions allowances to create a more predictable environment for decarbonization.