A coalition of eleven German states is lobbying the European Commission to incentivize the adoption of “green” steel within the automotive sector, signaling a potential shift in EU climate strategy and raising questions about the prioritization of industrial interests. In a joint letter addressed to European Commission President Ursula von der Leyen, the state premiers argue that factoring in the carbon footprint of steel used in vehicle manufacturing into emissions calculations is crucial for both achieving climate goals and safeguarding the competitiveness of Europe’s vital industries.
The move comes at a critical juncture, as the EU Commission prepares to unveil revised emissions regulations that could ease restrictions previously imposed on internal combustion engine vehicles. Recognizing the need to offset potential concessions on combustion engines, the state governments – encompassing regions heavily reliant on both automotive and steel production – are proposing that the use of low-carbon steel be directly credited against vehicle emissions targets.
The argument, championed by figures like Lower Saxony’s Minister President Olaf Lies, centers on the substantial investment underway in German steelworks to transition to carbon-neutral production methods. Proponents claim that incorporating “green” steel usage could reduce automotive production CO2 emissions by up to 6.9 million tonnes by 2030 – equivalent to the annual emissions of 3.5 million gasoline-powered vehicles. This, they suggest, could allow as much as 25% of new vehicles in the EU to be effectively calculated as carbon-neutral from the outset.
Critics, however, argue that this proposal could create a loophole allowing manufacturers to claim environmental progress without fundamentally altering vehicle design or embracing broader sustainability practices. Concerns have been voiced that the emphasis on steel emissions may overshadow the necessity for advancements in battery technology and overall energy efficiency within the automotive sector. The call for a lifecycle emissions assessment, while ostensibly progressive, also raises questions about the scope and rigor with which those assessments will be conducted and verified.
The lobbying effort, spearheaded by the state premiers of Niedersachsen, Saarland, Baden-Württemberg, Bayern, Bremen, Brandenburg, Hessen, Sachsen, Nordrhein-Westfalen, Rheinland-Pfalz and Thüringen, underscores the significant political pressure the EU Commission faces as it navigates the delicate balance between ambitious climate targets, economic realities and the demands of powerful industrial lobbies. The outcome of this debate will likely shape the future direction of European climate policy and its impact on the automotive transition.