Energy prices in Europe will remain high in the coming period, which will put pressure on the metal industry, says the director. According to Lahiri, this is problematic because the metal industry is crucial to the climate transition, ‘It’s a crazy paradox. We are under enormous pressure today as an industry and will be badly needed for the climate transition tomorrow.’
Last year, the European metal industry sounded the alarm about the continued existence of the sector due to high energy prices. Production of zinc and aluminum had fallen by 50%, and the steel sector was also in dire straits. As energy prices have fallen, the sector is in a slightly better position. ‘At that time there were dark clouds over the industry and it also rained. It’s stopped raining now, but the clouds are still there,” says Lahiri.
Competitive location
Due to the war in Ukraine, energy prices in Europe are higher than in the rest of the world. “The conflict is actually taking place in Europe, so it is not surprising that we are dealing with higher energy prices than in the rest of the world, but it is bad for the competitive position of European metal companies,” says the head of the trade association .
Save energy
The metallurgical industry has benefited from cheap Russian gas for years. According to Lahiri, therefore, energy conservation was not in the dictionary of metal companies. The director of the industry organization thus acknowledges that the industry is not entirely at fault. ‘That industry should have done more to save energy in the past is absolutely correct. However, due to low energy prices, there was no incentive for companies to do so,’ says Lahiri.
Also listen | Sekhar Lahiri (Metaal Nederland) on high energy and gas prices
The need to save energy is now there and European companies are also engaged in this, says the head of the trade association. ‘Companies like Tata Steel are already going greener. For example, the company is switching from gas to hydrogen for energy-intensive processes.’ The switch to green energy is not just the result of financial considerations. “It is true that social pressure has certainly accelerated these processes,” says the director.