Industry stakeholders have expressed support for the methodology developed by the Joint Research Centre (JRC) but argue that the proposed emissions performance classes require significantly stricter thresholds to accelerate investment in low-carbon steelmaking technologies.
Methodology focuses on lifecycle emissions
The JRC methodology applies a technology-neutral approach and assesses steel products on a cradle-to-gate basis. Fixed emissions thresholds allow the carbon performance of different production routes to be compared while recognising the contribution of recycled steel scrap to emissions reductions.
Supporters of the approach argue that it reflects the environmental benefits of circular material flows and provides incentives for production pathways with lower greenhouse gas emissions. The methodology also recognises the potential of fossil-free steelmaking technologies, including direct reduced iron and electric arc furnace production based on hydrogen.
According to proponents, the framework could help avoid long-term reliance on carbon-intensive production routes while supporting the European Union's climate and environmental objectives.
Potential contribution to resource security
The methodology may also influence the sourcing of raw materials for steel production. By assigning lower carbon footprints to products with high recycled content, it could encourage greater use of steel scrap and reduce demand for imported iron ore and concentrates.
Steel scrap is widely available within Europe and represents an important secondary raw material for the steel industry. Increased utilisation of recycled material could strengthen supply security and reduce dependence on imports from non-European countries.
Industry stakeholders also note that the JRC methodology is consistent with lifecycle assessment approaches used in other ESPR-related initiatives and aligns with regulatory frameworks covering construction products and materials such as aluminium.
Concerns over current performance classes
Despite broad support for the methodology, concerns remain regarding the proposed emissions thresholds within the performance classes. Critics argue that the current classifications are not sufficiently ambitious to stimulate investment in low-carbon and fossil-free steelmaking technologies.
For hot rolled coil, one of the most widely produced flat steel products in Europe, the proposed class B covers emissions between 1.79 and 2.66 tonnes of carbon dioxide equivalent per tonne of steel. As the average emissions intensity of conventional blast furnace-basic oxygen furnace production in the European Union is around 1.9 tonnes of carbon dioxide equivalent per tonne, many existing installations would already qualify without additional emissions reductions.
Similar concerns have been raised for wire rod products, where some fossil fuel-based production routes could qualify for higher performance classes despite ongoing efforts to expand lower-emission production technologies.
Call for stricter thresholds
Stakeholders advocating a stronger green steel label propose narrowing the share of products eligible for the highest performance classes. They suggest limiting classes A and B to the best-performing steel products and setting a threshold of 400 kilograms of carbon dioxide equivalent per tonne of crude steel between classes B and C.
Supporters of stricter criteria argue that the current proposal would allow a larger proportion of carbon-intensive products to qualify under green public procurement requirements. More demanding thresholds, they contend, would provide clearer market signals, improve differentiation between products and encourage further investment in low-carbon steelmaking across Europe.
The final design of the delegated act will determine how effectively the green steel label supports industrial decarbonisation, circular use of resources and the transition towards lower-emission steel production.
