The Czech steel company Třinecké Železárny continues to prepare for the transition to low-carbon steel smelting, calling for increased financial support from the Czech government and the European Union, said Petr Popelarj, Chairman of the Management Board of Moravia Steel, in an interview with the Czech edition e15.
The company that manages the Czech Republic's last integrated steel mill with a full production cycle from cast iron production to finished steel products,last year, plans for the construction of an electric arc furnace (EDP) worth about 20 billion Czech crowns (827.13 million euros) were postponed.According to Popelarge, this decision reflects the broader challenges facing the European steel industry, including high electricity prices, uncertainty around the EU's emissions trading system (ETS) and the high cost of decarbonization.
"We were not the only ones who postponed such a project. Similar investments are being postponed across Europe," Popelarge said, adding that while the company fully supports decarbonization, current financing remains insufficient. He argued that a 50% subsidy would not be sufficient to ensure the long-term viability of investments in current market conditions, and said discussions were continuing with the Czech government and EU institutions to identify additional support mechanisms.
Infrastructure work continues despite the delay in investments in the EAF
Despite the postponement of the EAF project, Trzyniecke Zhelezarni continues to prepare for the future transition. Currently, Energetika Třinec is implementing a project worth CZK 6 billion (EUR 248.13 million) aimed at replacing one boiler with a gas-fired power plant. At the same time, the company is developing the infrastructure for the planned EAF, including the acquisition of land for a new gas boiler. a high-voltage power transmission line connecting the site in Guta with a steel mill.
According to Popelarge, the final investment decision will depend on whether it is possible to ensure the necessary economic conditions. He stressed that the introduction of new steelmaking technology is essential to maintain primary steel production in the long term. "If the current system remains unchanged, blast furnace steel production will no longer be economically viable," he said. он.
Uncertainty about ETS and energy costs remain key concerns
Popelarge called the future of ETS in the EU one of the company's most serious problems, in particular, rising prices for carbon dioxide emissions and the planned increase in electricity prices. Phasing out free emissions permits, which management considers a major source of uncertainty for future investments.
He also commented on Moravia Steel's unsuccessful attempt to acquire assets in Liberty Ostrava. Although the company initially considered the possibility of acquiring the entire business in early 2024, later, after the shutdown of the Liberty blast furnace, it switched its attention to the pipe rolling the workshop, considering it strategically more suitable for the production activities of Trzyniecke Ironworks. According to Popelarge, restarting the blast furnace is becoming more difficult as it stays idle longer, and he calls its shutdown the first major problem. a mistake in the Liberty restructuring process Ostrava.
The war in Ukraine has affected the supply of raw materials and the European market стали
The company also highlighted the continuing impact of the war in Ukraine. After the Russian invasion in 2022, Trzyniecke Zhelezarnie lost control of its iron ore mine near Zaporizhia after Russian troops occupied the area. Although alternative supplies of raw materials were later provided, Ukraine is still dependent on the supply of more than three million tons of iron ore per year.
According to Popelarge, the exceptionally high demand for steel immediately after the outbreak of war made 2022 an extremely successful year. However, the sharp rise in energy prices subsequently weakened demand during 2023. He also noted that the destruction of Ukrainian steel production facilities in Mariupol has fundamentally changed the European steel market, while Ukrainian producers continue to benefit from lower regulatory costs than steel producers in the EU. According to Popelář, high European energy prices and carbon costs will remain the two biggest competitive advantages over EU steel producers compared to competitors in countries such as the United States and China.
Looking ahead, Popelář emphasized that steel remains strategically important for Europe's security, infrastructure and industrial sustainability. He notes that Trzynecke Zhelezarni is the only rail manufacturer in the Czech Republic and continues to supply rails to Ukraine, which underscores the importance of the industry to support the reconstruction of infrastructure during the war.
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