EuRIC, the voice of Europe’s recycling industries, welcomes the EU’s initiative to define and label “green steel” as outlined in the Steel and Metals Action Plan, in an effort to support the decarbonisation of this industry and strengthen its competitiveness.

As discussions evolve and methodologies are assessed, EuRIC stresses the need for a methodology that is rigorous from a scientific standpoint and acknowledges the environmental benefits of bridging circularity and decarbonisation goals. Substituting iron ore with recycled steel saves approximately 1.67 tonnes of CO2^[1] per tonne of steel produced and 72% of the energy needed for primary production^[2]. Incentivising the use of the recycled steel, a broadly available resource^[3] produced in Europe, is also a strategic move to support reducing dependency on imports of raw materials and energy. 

Just as the waste hierarchy under the Waste Framework Directive (WFD) ranks waste treatment options by environmental impact, EuRIC suggests that a similar principle should by applicable in context of the labelling of green steel. Therefore, we believe the upcoming labeling scheme should recognise steel products manufactured with low emissions and recycled materials as the most sustainable option overall.  A definition of green steel that focuses exclusively on the carbon emissions of the steelmaking process, could be detrimental to the European steel industry due to unfair level playing field with third countries, which are not fully addressed by the Carbon Border Adjustment Mechanism (CMAB) and the safeguard measures.

Key asks:

• Support products that are made with low emissions and recycled materials as the most overall sustainable option, to recognise recycled steel as a key enabler of EU decarbonisation and circularity.
• Use robust life cycle assessment (LCA) methodologies covering Scope 1, 2, and 3 emissions and avoid the introduction of distorting factors.
• Dismiss approaches, like the sliding scale, that undermine circularity and dismiss its contribution to decarbonisation.
• Adopt the GSCC glidepath as a credible, technology-neutral framework, creating separate performance classes for long and flat products.

EuRIC strongly supports the development of green markets and labels that incentivise the use of circular, low carbon, and locally sourced materials in manufacturing. Scientific evidence clearly shows that substituting raw materials from mining or petrochemical with recycled materials is the most mature and effective way to reduce CO₂ emissions and enhance circularity. In the steel sector alone, substituting iron ore with recycled steel reduces CO₂ emissions by 58%^[4] . Considering these impressive environmental benefits EuRIC highlights that steel that is both low-carbon and circular simultaneously delivers two core environmental benefits, climate change mitigation and circular economy (resource efficiency), as recognised by the EU Taxonomy Regulation, and should therefore be rewarded as such.

The waste hierarchy under the Waste Framework Directive (WFD) ranks waste treatment options by their environmental impact, EuRIC suggests that a similar principle should by applicable in context of the labelling of green steel. Hence, European steel products manufactured with low emissions and using recycled materials should be rightfully acknowledged as the most sustainable option according to the IDAA.

A definition of green steel that focuses exclusively on the carbon emissions of the steelmaking process fails to recognise Europe’s main competitive advantage and risks opening the door to more imports. Considering the importance of reducing dependency on imports of energy and raw materials,  Europe needs to make the most out of its own resources and incentivise the use of recycled steel, a broadly available low carbon resource that is locally produced.

Additionally, focusing solemnly on CO₂ emissions risks further aggravating the situation of uneven level playing field and unfair competition raised by European steel producers.  The commitments made by flat-steel players to replace their coking-coal-based blast furnaces (BFs) with direct-reduced-iron plants to decarbonise their steel production stalled due to the increased energy prices and the delayed deployment of green hydrogen in Europe. Yet on the internal market we are already witnessing a surge in imports of finished Direct Reduced Iron (DRI) products ^[5], which due to a loophole in the Carbon Border Adjustment Mechanism (CBAM)^[6], will favour third-country DRI-EAF long products over less carbon intensive European products made with recycled steel.

In light of the ongoing public debate and the JRC’s recent assessment of the currently available methodologies to support steel decarbonisation, EuRIC warns against adopting  approaches, such as the sliding scale, which are based on faulty assumptions, such as a lack of recycled steel,  aim to provide a definition of ‘green steel’ that would ultimately harm European steel manufacturers and the decarbonisation objectives.

Methodologies that introduce distorting factors to adjust the actual emissions associated with certain products  actually undermine genuine decarbonisation efforts and will not support the achievement of our climate neutrality objectives^[7].

Instead, to ensure the environmental benefits of circularity are properly recognised, valued and incentivised, any certification scheme for “green steel” must be based on robust life cycle assessment (LCA) methodologies that consider emissions across the entire value chain (scopes 1,2, and 3). These should not be distorted by the introduction of factors aimed at recalibrating the actual carbon footprint of a product through the lens of a flawed perspective that favors mining over recycling in the name of scarcity.

To support the development of an EU-wide voluntary certification scheme for ‘green steel’, EuRIC recommends introducing separate performance classes for long and flat steel products, using the glidepath developed by the Global Steel Climate Council (GSCC) as a starting point. This approach would both ensure fair comparisons across product types and also strengthen the competitiveness of EU steel manufacturers.  Unlike some global competitors, European players lack access to cheap natural gas to power DRI steel manufacturing or abundant resources of iron ore. Yet, Europe boasts high steel recycling rates and should not rely on methodologies that penalise its own competitive advantage.

The GSCC glidepath^[8] is a technology-neutral methodology designed to incentivise real decarbonisation of the steel sector, regardless of the production route or feedstock used.  In contrast to other methodologies evaluated by the JRC, the GSCC approach is based on LCA/carbon footprint (scope 1, 2, and 3) without a credit system and offers better insight into mapping carbon footprint performance.  Being a truly technology-neutral methodology, this approach recognises, instead of penalising, the emissions savings associated with the use of recycled materials – thereby supporting circularity as a cornerstone of EU climate and decarbonisation goals.

The visuals included in this document are EuRIC’s own design and aim to illustrate a potential pathway for “green steel labeling”.  They represent a technology neutral methodology that acknowledges the difference between long and flat steel products. The illustrations are not developed or officially endorsed by the GSCC.

EuRIC would like to highlight that the GSCC already provides a framework based on internationally recognised standards (ISO) and includes a clearly defined timeline toward net-zero emissions. It requires steel manufacturers to set science-based emissions reduction targets in line with the Paris Agreement and the goal of limiting global warming to 1.5°C above pre-industrial levels. The standard, including Scope 1, Scope 2, and Scope 3 emissions, requires steel manufacturers to have their emissions data and targets verified by third-party organisations to ensure accuracy and transparency.

Establishing performance categories within the GSCC glidepath is both feasible and pragmatic. As illustrated above, this option would provide fair recognition for both steel manufacturers using recycled materials and DRI-EAF producers using natural gas as a reducing agent, without penalising innovation. The GSCC’s gradually tightening intensity benchmarks reflect the long-term nature of steel decarbonisation and encourage continuous improvement and innovation in reducing carbon emissions.

^[1] Circular steel : Powering a competitive, low carbon and circular European steel industry (available here)

^[2] euric_metal_recycling_factsheet.pdf

^[3] European Commission, Joint Research Centre, Analysis of the EU Steel supply chain: current trends and circularity opportunities. Raw Material Information System Brief, Ispra, 2025, JRC142660.

^[4] Circular steel : Powering a competitive, low carbon and circular European steel industry (available here)

^[5] EU increased DRI imports

^[6] The adjustment calculations for imports of steel products manufactured through this route, which can achieve some of the lowest emissions, would be based on the benchmark existing for primary steel products, which have the highest emissions. The outcome of this would be that such products would benefit from a significant overadjustment. Considering the current energy prices, the DRI route has become cost prohibitive to scale up in Europe, but could represent a competitive advantage to emerging steelmaking countries in the MENA region, which can benefit from low natural gas prices to support investments into additional DRI capacity.

^[7] Why the sliding scale is a slippery slope for defining green steel (available here)

^[8] More information available here