Steel giant ArcelorMittal announced intentions to invest €1.3 billion to decarbonise its plant in Dunkirk. Should we be celebrating?
While ArcelorMittal’s plans to invest over a billion to decarbonise its site in Dunkirk sound groundbreaking, critics point to a history of inaction despite lofty promises and billions in subsidies.
ArcelorMittal, one of the world’s largest steel companies, announced last week that it has the “intention to invest” over a billion Euros to decarbonise its plant in Dunkirk and make lower-emission steel. In a press release, the company wrote that it’s working closely with the French government “whose leadership is essential in defending the steel industry in France and Europe.”
The cash will be spent on a new Electric Arc Furnace (EAF) at its site in Dunkirk which the company says will effectively decarbonise the plant’s steel production.
The news comes in the context of a longstanding crisis of European steel production as the industry has been beset by low steel prices from imports and high energy prices induced by the war in Ukraine.
While the EU has recently announced its plan to protect the sector and has argued that Europe's plans for rearmament will save Europe’s steel, layoffs and job cuts continue being announced by the continent’s steel companies.
Although low-emission steel production will be an essential ingredient of Europe’s plans for a just transition, critics argue there are reasons to look at ArcelorMittal’s announcement with scepticism.
Backtracking on promises
ArcelorMittal has long described itself as a global leader in the push for lower-emissions intensity steel production. However, the NGO Steelwatch has argued that the recent announcement is just one example of a pattern where the company presents backtracking on previous, more ambitious decarbonisation plans as positive developments.
In a press release responding to the announcement by ArcelorMittal, Steelwatch says that from a climate perspective, installing an EAF is insufficient since the majority of emissions in steel production come from making the iron that feeds into the furnace itself, rather than the final production of steel.
Previously, ArcelorMittal had announced plans for low-emissions intensity iron production. More recently however, the company had argued that iron production via low-emissions ‘Green-Hydrogen’ production will not be economically viable until at least 2030.
Billions in state aid without meaningful decarbonisation
In December of 2024, Carbon Market Watch published an analysis showing that ArcelorMittal has received public subsidies of at least €3 billion, including €1.3 billion in German state aid in 2024 alone. The French government had provided the company with €850 million in 2023 to help fund a Direct Iron Reduction Plant and two EAFs.
These subsidies come on top of the €3.76 billion worth of free pollution permits given to the company in just 2023, the analysis adds.
This money was given to help facilitate its transition to low-emissions steel production. However, a separate report from Steelwatch argues that ArcelorMittal has spent just 2.5% of its operating funds on decarbonisation and when compared to 2018, its CO2 intensity has fallen only by 5% in Europe.
At the same time, the report finds that the company spent billions on shareholders, with $1.3 billion going to share buybacks and $393 million on dividends in 2024 alone.
Slashing jobs in Northern France
Back in April, ArcelorMittal announced 630 job cuts in Northern France, representing around 10% of its workforce in the region. The company says that these cuts are not related to production itself (consisting of supportive and administrative functions).
The local trade union, CGT Dunkirk, was furious when the cuts were announced: “Mittal announces over 800 million euros in profits for the first quarter of 2025, but that’s still not enough for them! Instead of investing in the future, the group maintains its strategy of sabotaging the French steel industry and destroying jobs!”
Industriall-Europe, the European trade union confederation representing industrial workers, argued that if companies like ArcelorMittal receive state aid, it must have strict conditionalities attached such as job guarantees and the protection of industrial capacity.
In contrast, it appears that the company is the one making demands.
In its press release announcing the investment intentions, it suggests that the investments are conditioned on the EU following its guidance of steel import limits and strengthening its plans to protect the steel industry.
The local trade union CGT Dunkirk ends its response to the job cuts by proposing an entirely different future for the steel site:
“NO TO OFFSHORING! NO TO LAYOFFS! THE FUTURE OF STEEL? IT’S DECARBONISATION AND NATIONALISATION!”
ArcelorMittal did not respond to questions for this article.