BDSV Submitted Proposal to Implement Scrap Bonus within EU

Specifically, the ecological impact of steel production from ores is not fully taken into account, Junker said.

SEATTLE (Scrap Monster): The Federal Association of German Steel and Recycling Companies (BDSV) submitted a proposal to the European Commission (EC) towards mapping the scrap bonus in the EU emissions trading system (ETS).

A major component of the proposal is the allocation of free ETS certificates, which will promote the use of climate-friendly recycling raw material steel and stainless steel scrap as substitutes for primary raw materials. This will also help in achieving the Carbon Border Adjustment Mechanism (CBAM), the trade body noted.

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Thomas Junker, General Manager, BDSV noted that the allocation of free EU ETS certificates is a central recommendation of the Fraunhofer IMW study published by it in November last year. The fourth phase of the EU ETS planned for 2021-’30 has significant gaps that put the recycling raw material steel and stainless steel scrap at a disadvantage compared to primary raw materials. Specifically, the ecological impact of steel production from ores is not fully taken into account, Junker said.

According to BDSV, the scrap bonus is currently only insufficiently included in the price mechanism. It proposes a new paragraph to the EU Commission, to be added to Art. 10a EU ETS. Also, it calls for the inclusion of hard coal, iron ore and non-ferrous metal ore mining in Annex I of the EU ETS Directive.