The adjustment would call for any shortfall in CO2 emissions to be compensated by the importer. The green border adjustment would incentivise effective reduction in carbon emissions and prevent the competitiveness of the European steel industry being eroded.
Following the implementation of phase 4 of the ETS European steel producers will incur additional costs that companies producing in other regions of the world and importing into Europe are not obliged to pay.
Steel is a globally traded material with approximately one third consumed in a different country to where it was produced. Imports into Europe have increased in recent years as a result of global overcapacity with imports from countries without comparable climate policies in 2018 standing at approximately 26 million tonnes on an annualised basis.
Speaking at the company's annual media day, held in Paris, Aditya Mittal, President and CFO of ArcelorMittal, said: