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The European steel industry recommendations on Industrial Demand Side Response
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Executive summary
➢ As decentralised energy systems will be dominated by variable and intermittent weather-dependent electricity generation, the provision of flexibility services under all relevant time-frames will need to be scaled massively to maintain an efficient functioning and security of supply.
➢ The European steel industry is already a key provider of flexibility in the EU electricity system.
➢ The need to realise in record-time new fossil-free generation capacity and expand electricity grids, key enablers of the decarbonisation of industries, shall nonetheless remain the priority.
➢ The sector could contribute further provided that the structural challenges around the energy transition, namely the speedy roll-out of new generation capacity, the expansion of grids, and the restoration of cost-affordable electricity prices, are addressed first and as a priority.
➢ The assessments of flexibility needs, technology potentials, and the related target-setting process shall preserve and respect the economic, organisational, and technical limits of industrial production processes such as steel.
➢ European and national initiatives on demand-side response should create the optimal conditions for industrial consumers to provide flexibility while retaining international competitiveness and limiting overall electricity system costs:
➢ The steel sector overall welcomes the increased focus and planned actions to unlock the full potential of the wider range of DSR technologies in the pursuit of increased system resilience and more efficient use of electricity grids.
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Brussels, 25 June 2024 – The EU decision to continue the steel safeguard for another two-year period is a much-needed step towards ensuring the stability of the steel market amidst the highest levels of import penetration ever recorded in the EU. However, as global excess capacity is projected to increase even further in the coming years, a longer-term solution needs to be developed to address this structural challenge, says the European Steel Association.
Joint Statement
The existential threat posed by worsening non-market excess capacity cannot be ignored.