By Tassilo Hummel, Christoph Steitz
PARIS/FRANKFURT (Reuters) -The European Commission cleared two major subsidy packages from France and Germany to support their top steelmakers – ArcelorMittal and Thyssenkrupp Steel Europe respectively – in efforts to reduce carbon emissions.
The approval on Thursday of 2 billion euros ($2.24 billion) in aid marks a major milestone for Thyssenkrupp, which depends on public funding to decarbonise steelmaking, among the most CO2-intense industrial production processes.
Apart from the Thyssenkrupp funding, which is split into a 550 million-euro direct grant and a conditional payment mechanism of up to 1.45 billion euros, the Commission also approved an 850 million-euro package Paris had put in place for ArcelorMittal.
Reuters reported earlier this week that the Commission’s approval of the grant could come as early as Thursday.
The move highlights Brussels’ efforts to help industry on the continent decarbonise production and remain competitive with rivals, aware that heavy industries are unable to fund the transition on their own.
“This will contribute to the greening of one the most polluting sectors, while helping reduce Germany’s dependence on imported fossil fuels and develop the renewable hydrogen value chain in the EU,” said EU antitrust chief Margrethe Vestager.
Shares in Thyssenkrupp and ArcelorMittal were up 1.4% and 2.8%, respectively.
German Economy Minister Robert Habeck, who drew flack from labour representatives for what they say was a lack of support for steel, said it was an “enormously important decision for climate protection and for Germany as an industrial location.”
($1 = 0.8922 euros)
(Reporting by Tassilo Hummel, Christoph Steitz and Matthias Williams; editing by Matthias Williams and Sharon Singleton)
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