LESS: Driving Trust in Europe’s Clean Steel Markets

Brussels, 15 October 2025 – Europe’s steel industry is pivotal to the continent’s climate ambitions. As one of the most carbon-intensive sectors, it faces the twin challenge of deep decarbonisation and global competitiveness. The Low Emission Steel Standard (LESS) is emerging as a key tool to make that transformation measurable, credible, and investable.

At a high-level event in Brussels, co-hosted by LESS and Euractiv, industry leaders, policymakers, and civil society explored how standards, transparency, and market incentives can accelerate the shift to low-emission steel.

 

LESS: A Foundation for Trust and Market Transformation

“Steel is one of the most CO₂-intensive industries. We must move forward – not just in Europe, but globally,” said Gunnar Groebler, Chairman of LESS and CEO of Salzgitter AG. He called the growing adoption of LESS “a milestone” in defining what truly counts as green steel.

Dr. Beate Baron, Director-General for Industrial Policy at Germany’s Ministry for Economic Affairs and Energy, described LESS as a crucial bridge between industrial policy and market transparency. “LESS is the missing puzzle piece for creating clarity,” she said, noting Germany’s €6 billion investment in steel decarbonisation. “It can be used by both public and private procurement. LESS is MORE. Let’s use it and let’s start.”

Dr. Carmen Ostwald, Secretary General of LESS, announced that six companies have already received the first certificates. The system’s sliding-scale approach, she said, “encourages decarbonisation across all production routes.” LESS, she added, is “more than a label – it’s a strategic tool to support transformation.”

 

Demand-Side Policies: Incentives Over Mandates

The European Commission is shifting from regulating emissions to stimulating demand for clean materials. “We are building the business case from the demand side – that is new,” said Kerstin Jorna, Director-General for Internal Market, Industry, Entrepreneurship and SMEs.

She pointed to two levers: greener public procurement and innovation funding through tools to de-risk early investments such as the Hydrogen Bank and the Competitiveness Fund.

For buyers, incentives matter more than mandates. Céline Domecq, Director of Public Affairs at Volvo Cars, said: “We prefer incentives – tax breaks, rewards – that push in the right direction and make the business case easier internally.” She supported the idea of crediting low-emission steel in automotive CO₂ balances but warned: “We must ensure it doesn’t dilute what already exists for the car industry.”

Jorna added: “We have a policy on tailpipes for automotive. We don’t have a policy on the body. That’s an open issue. In the best of worlds, we have both and can make progress on both.”

As the EU builds demand, the next challenge is financing the transformation: balancing investment risk with industrial continuity.

 

Financing the Transition: Transformation vs. Greenfield Investments

Decarbonising Europe’s steel sector requires huge capital, but the path differs between transforming existing production sites and building new ones.

For existing producers such as Tata Steel Nederland, the challenge is transforming while producing. “You have to serve your customers with the right quality while changing almost everything,” said Peter Bernscher, Chief Commercial Officer. Tata Steel intends to replace its blast furnaces with direct-reduction plants, which will first be operated using natural gas and, once they are competitive, renewable hydrogen or biomethane. Enabling policies for decarbonisation are still lacking – both for existing and new production sites. If decarbonisation is to become feasible, policy change needs to be implemented as soon as possible.

By contrast, new entrants can start fresh. Luisa Orre, Chief Business Development Officer at Stegra, explained that the company’s fossil-free greenfield project in northern Sweden is anchored in renewable energy and guaranteed demand. “The Stegra project is underpinned by customer demand and a seven-year ‘take or pay’ contracts, which enabled us to finance the project,” she said. Access to abundant, low-cost green power cuts both costs and emissions from day one.

Different strategies – but a shared dependency on market confidence. Investors and customers must trust that “green steel” truly means low-emission steel. That’s where credible standards like LESS become essential.

 

The Need for a Trusted Label: Beyond EPDs

Trust, many agreed, is the cornerstone of Europe’s emerging green-steel markets. Caroline Ashley, Executive Director of SteelWatch, noted that while Environmental Product Declarations (EPDs) show a product’s current footprint, they don’t drive improvement. “We need both: an EPD that tells us where we are now, and a label like LESS that drives change,” she said. “LESS is about transformation.”

A trusted label, Ashley added, could simplify procurement and give buyers and investors a reliable signal. “Without trust,” she said, “there is no market.”

 

Does LESS Disadvantage Recycling? The Scrap Debate

Not all agreed on how standards should treat different production routes. Bruno Tobback, Member of the European Parliament, warned that recycling – by far the most energy-efficient option – must remain a priority. He questioned whether LESS’s sliding scale could disadvantage scrap-based steel compared to primary production.

Orre countered that scrap alone cannot meet demand. “It’s impossible to just recycle our way out of the problem. We need to decarbonise ironmaking itself,” she said. Ashley added that even by 2050, scrap will meet less than half of global steel demand, making decarbonised primary production essential.

 

A Unified Call for Credible Standards and Action

Despite differing views, the panelists agreed on one point: Europe must move fast and credibly.

“Real transformation requires vision, leadership, and investment,” said Ashley. “European leadership, and not wobbling, will drive climate progress across the industry.”

Tobback called for political resolve: “You need a high-speed train, not an omnibus that stops at every station. Otherwise, there’s no advantage in being a leader.”

Bernscher highlighted the urgency from industry: “We’ve signed a joint letter with the Dutch government to cut CO₂ emissions by 40% in the Netherlands. This year is crucial – we must convince shareholders that the money is well invested.”

The “Clear Standards for Clean Steel” event made one thing clear: technology and commitment are no longer the bottlenecks – policy is. LESS has laid the foundation for credible clean-steel markets, but without strong demand-side measures and investment certainty, Europe risks losing momentum. To make the green-steel transition a success, policymakers must now turn standards into strategy and ambition into action.

This article summarizes key discussions from the event “Clear Standards for Clean Steel,” held on 1 October 2025 in Brussels. Direct quotes are reproduced verbatim but condensed for clarity. The full recording of the event is available here: Clear Standards for Clean Steel: The Role of LESS in Developing European Lead Markets.