Cabinet wants to keep Tata Steel for the Netherlands, up to 2 billion needed for greening

The government will investigate whether it is feasible to implement some of the steel group’s greening plans more quickly. Minister Adriaansens of Economic Affairs and Climate and State Secretary Heijnen of Infrastructure and Water Management want to make agreements about this with Tata Steel Netherlands in the short term.

Tata Steel may need a subsidy of 2 billion euros for its greening plans until 2030. If sustainability has to go faster, a maximum of 50 percent will be added. This became apparent during the presentation of the advice of former minister Hans Wijers and Frans Blom of consultancy firm BCG to the cabinet. These numbers do not appear in the public report, but they were mentioned in a presentation to the press, including BNR. Until now, the government contribution that Tata Steel needs has been shrouded in mist.

For example, health risks must be reduced in the shorter term, Adriaansens and Heijnen write in a letter in response to two reports on steel production in the IJmond to the House of Representatives. Tata Steel Netherlands (TSN) can only remain competitive in a sustainable way if the government can guarantee sufficient cheap green energy. Just like in other countries, the government must provide financial support to make greening production possible. This is what former minister Hans Wijers and Frans Blom of consultancy firm BCG advise in the report How to make Tata Steel more sustainable.

At the request of Minister Micky Adriaansens of Economic Affairs and Climate (VVD), Wijers and Blom have listed five future scenarios for the Tata Steel branch in IJmuiden. With a view to preserving jobs and strategic autonomy, among other things, they advocate maintaining steel production in IJmuiden. “Control over the steel supply chain through production and reuse is of strategic importance for Europe,” the report states.

Five scenarios

The five scenarios vary from no tailor-made agreements to closure of the Tata Steel branch in IJmuiden, but according to Wijers and Blom, these options are far from ideal: continuing as usual will affect social support. Closure costs jobs and entails major public financial costs. The other three options involve varying degrees of greening.

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One of those variants is a plan that TSN recently presented, in which the closure of a blast furnace and a polluting coke factory by 2030 is the starting point. These would be replaced by new installations that can produce steel ‘greener’. In addition, there are two variants in which sustainability progresses faster. In all scenarios, the government must step in to keep TSN competitive compared to other steel giants.

Decisions about Tata’s future

The advice expressly mentions Tata Steel’s location by the sea as an important condition for continued competition with other European steel producers. according to the advice, continue to compete with other European steel producers. It is important to make short-term decisions about the future of the steel group. Hurry is needed with greening, to prevent the competitive position from coming under pressure.

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According to Wijers and Blom, persistent uncertainty leads to unrest within the company, among local residents and other stakeholders. the social acceptance of steel production in IJmuiden may suffer as a result. Elsewhere in Europe, government support is already on the agenda for at least ten steel factories. Plans to significantly reduce CO2 emissions by making factories greener are already well under development. “They are therefore ahead of TSN in this regard,” the report states.