2023-11-24 05:15:00
On the table of the new minister Jordi Hereu is the future of the Asturian industry. The former mayor of Barcelona, as head of the Industry portfolio, has on the list of pending issues the launch of ArcelorMittal’s decarbonization plan in Asturias, an investment of 1,000 million that has not yet found a clear track despite having guaranteed aid of European funds of 450 million. The multinational steel company demands, to begin take-off, “a scenario of energy costs that make the investment viable and the new facilities sustainable.” To date, this scenario has not been cleared up and the Government of Spain has not guaranteed the continuity in 2024 of the current exceptional measures so that the large electro-intensive industry does not lose competitiveness. Other countries have paved the way for investments by the multinational steel company, which is advancing projects in France, Germany and Belgium.
From Reyes Maroto and Héctor Gómez, his predecessors in the position of Industry, Hereu – heir in Catalan – has received as a legacy the unfinished negotiation with ArcelorMittal. The president of the Principality, Adrián Barbón, often says that ArcelorMittal “pivots the industrial development of Asturias” and its facilities will only have a future if their decarbonization is addressed. In July 2021, Pedro Sánchez and the Mittal family announced in Gijón an investment of 1,000 million to replace one of the two Veriña blast furnaces with a direct reduction iron ore plant (DRI system) with green hydrogen and a hybrid furnace electric arc. Last June, the multinational gave the green light to the electric oven; but the DRI plant, for which European aid of 450 million has been approved, still has not received the go-ahead.
The electric furnace could operate without the need for the DRI plant by importing the pre-reduced iron and mixing it with scrap. There would be a significant reduction in CO2 emissions, but Asturias would no longer concentrate the integral steel process for the manufacture of long products and the job cuts would be greater than expected as there was no alternative to closing one of the blast furnaces. ArcelorMittal does not approve the investment in the DRI plant because it considers that “an energy scenario” of cheaper, stable and predictable prices is not assured. The multinational has been “working” with the Government of Spain for months on this issue because it is crucial “for the viability of the investment and the sustainability of the new facilities.” The electric furnace will increase the electricity bill and the DRI will increase natural gas consumption and use green hydrogen, whose current costs are far from being competitive with traditional fuels. Furthermore, the project in which ArcelorMittal participates to produce green hydrogen in electrolysis plants in Castilla y León and transport it to Asturias through the La Plata gas pipeline (HyDeal España) is still surrounded by unknowns due to its complexity and a change of plans to bring hydrogen production centers closer to the consuming plant.
The competition
The multinational steel company has decarbonization projects similar to Gijón in factories in France, Germany and Belgium. Although the Asturian project was the first that Arcelor processed before the European Competition authorities and the first to receive permission to access public aid, several factories have taken advantage of the Asturian complex. The decarbonization plans for the Ghent, Dunkirk and Bremen plants are advancing and their basic projects have already been awarded to a company that is also Spanish: Técnicas Reunidas.
Eduardo Rodríguez, director of the decarbonization program of the Asturias Cluster of ArcelorMittal, slipped in a few days in Avilés – to justify that the Asturian project was relegated – that electricity rates for large industries are more competitive in countries like France. Furthermore, Germany has just agreed on a 28 billion plan to lower the price of electricity for industries. Meanwhile, in Spain, it is not decided whether as of next January 1 the exceptional measures to suspend taxes and reduce electricity toll costs will remain in force to alleviate the rise in energy prices.
Jordi Hereu lands in this scenario, coming from the presidency of Hispasat and representing the share of the Socialist Party of Catalonia (PSC) in the Government. The Asturian Francisco Blanco will not be on his team, who has ceased his position as Secretary General of Industry, and it remains to be seen if the also Asturian Luis Ángel Colunga continues as Commissioner of the Decarbonization PERTE in which the aid to Arcelor.
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