ArcelorMittal confirms to the Belga news agency that a decision will be made on investments in sustainable steel at its Ghent site in the course of 2024. In the meantime, engineers are investigating how the multinational can produce sustainable steel in Ghent and Dunkirk, France. No projects have been stopped.
The construction of two electric smelting furnaces and a DRI installation in the Ghent steel factory has been investigated since 2021. But the investment of more than 1 billion euros would be under pressure because a steel factory in Dunkirk, France can count on generous subsidies. The newspaper De Tijd reported earlier this week about doubts surrounding the arrival of the DRI installation. The issue was also discussed in the federal parliament.
ArcelorMittal indicates that all projects are in the research phase. In a results report, the listed company even mentions additional investments, including for an electric oven in Gijon, Spain. The group also reports that demand for sustainable steel is showing clear growth. For example, the Danish wind turbine builder Vestas wants to build turbines with recycled steel and the French producer Schneider Electric wants to produce sustainable electricity applications.
Climate neutral
The investments in Ghent and Dunkirk are explicitly mentioned by the steel giant, which wants to be climate neutral by 2050. By 2030, CO2 emissions should be reduced by 35 percent.
In 2021, a declaration of intent was signed in the Ghent town hall in the presence of the government and the Mittal family. Since then, engineers have been working on the concrete design. The fact that the DRI installation in Dunkirk is being studied does not mean that the investment in Ghent will not happen, says the Ghent management. “In order to use resources as efficiently as possible, we are giving priority to the detailed design phase of the electric smelting furnace, in order to develop the detailed engineering of the DRI in a next phase,” reads the official statement.
Investments that yield faster returns may be given priority by international management. ArcelorMittal’s European management indicates that “project costs, access to funds and future energy prices will influence the rollout of DRI and electric blast furnaces.”
The subsidy file for the Ghent branch was completed in June 2023, amounting to 280 million euros. But ArcelorMittal can also count on extensive support in France and earlier this year announced a long-term partnership with French state-owned energy company EDF. Cheap energy is a strong asset for the operation of electric blast furnaces.
Concerned ministers
Federal Minister of Energy Tinne Van der Straeten (Green) expresses her concerns. The federal government is trying to counter the abundance of nuclear energy in our southern neighbors with assertive support for green energy. “Belgium has many assets, including access to green and cheap energy through our offshore wind farms,” says Van der Straeten. “In 2021, we also introduced the energy standard, a necessary instrument so that our companies do not incur additional competitive handicaps.” But a bidding war between member states to offer multinationals comfort is not without risks for a small country like Belgium. “If we compete with each other internally, everyone loses, except countries outside Europe,” says the Green minister.
Flanders invests in the Ghent ArcelorMittal site through the Finocas partnership. “Flanders is doing everything it can to motivate foreign industrial companies to invest here, especially when it comes to innovation in the field of sustainability,” says Flemish Prime Minister Jan Jambon (N-VA). But the Flemish government is also protecting itself from a subsidy bid. “Now we often have to compete against countries with deep pockets that give excessive subsidies to certain companies,” says Jambon. “That cannot be the intention within a model of European cooperation.” Jambon wants to make the issue a priority within the current EU presidency.
