Evangelos Mytilineos, the new chair of the EU’s largest non-ferrous metals industry association Eurometaux, has slammed the bloc for not doing enough to help metals producers — a failure he described as “suicidal” and one with the potential to ripple across European industry as metals businesses folded or moved elsewhere. POLITICO’s Victor Jack talked with him about EU policy, deindustrialization and the energy crisis.
How has the energy crisis impacted Europe’s metals industry?
EM: Since September 2021 the EU has witnessed a curtailment and shutdowns of 50 percent of its primary smelting capacity of aluminum and zinc because of the energy crisis — in some cases threatening the survival of entire facilities. Permanent job losses are so far low, with exceptions being a smelter in Slovakia and a Dutch plant shutting permanently. Some temporary closures will become permanent if conditions do not improve soon. The EU produced 2 million tons of aluminum in 2021 but that will be less than 1 million this year.
What are the consequences of this, and what wider risks do EU industries face?
EM: All European governments want to move toward electrification, a key neighbor of decarbonization — meaning heat pumps, e-vehicles and green hydrogen — but to do all this you need millions of tons of metals. Either we produce in Europe, or we buy from elsewhere where the production has a much heavier CO2 footprint, such as in Indonesia, Iran or India. Europe’s replacement aluminum imports have added 6 million to 12 million tons of annual CO2 emissions alone. So we commit suicide as a Continent if we shut down our industries and move production elsewhere. It’s a suicidal policy, and we expect the European Commission to wake up and do something about it.
Do you expect metals firms to start moving elsewhere permanently?
EM: I don’t expect metals companies to move elsewhere — I’m sure of it. German chemical giant BASF’s move to permanently downsize in Europe and throw its weight behind a China expansion has been a total shock to the metals industry. That was due to the cost of energy and CO2 regulations which are by far the strictest in Europe globally. I want to praise the U.S. Inflation Reduction Act that relies on federal support — in Europe we don’t do this. We are very disadvantaged vis-a-vis the Americans and the Chinese.
What do you think of the EU’s response to the energy crisis so far?
EM: The reaction of the European Commission vis-a-vis the energy problem of the industry was totally inadequate if not nonexistent. More than 90 percent of clawbacks from EU windfall taxes are going to households; at the moment, industry is on the sidelines. So far we have had no response to our letters to the Commission. They should reduce excessive power prices, improve and encourage faster implementation of the temporary state aid framework, temporarily apply a prevention of excessive carbon costs via compensation, and push for a massive rollout of renewables.
