US Energy Regulations Could Seriously Hurt Metals Companies

The American Iron and Steel Institute (AISI) commented on the US Environmental Protection Agency (EPA) proposal endorsed by President Obama, believing it could seriously harm the country's international steel industry competitiveness.

Thomas Gibson, president of AISI, said electricity is one of the most significant cost drivers for steel production. The availability of electricity is critical to the international competitiveness of the national steel industry. The proposed environmental regulations for power plants may have a negative impact on the cost and security of electricity supply to industrial consumers. This, in turn, will affect the profitability of metallurgical companies.

The institute stressed that the production of the country's leading metallurgical industry is highly dependent on electricity produced from coal. EPA regulation will primarily affect coal-fired power plants, which in turn will have a negative impact on steel production. AISI noted that the domestic steel industry has already reduced its energy intensity by 28 percent since 1990, while greenhouse gas (GHG) emissions have been reduced by 35 percent over the same period.

The proposed action for power plants EPA intends to reduce carbon dioxide emissions from existing power plants in order to protect public health, guiding the United States towards a cleaner environment and combating climate change. However, they do not take into account the industrial needs of the country at the present time.