Study shows EU can cut industrial emissions without losing industry
Researchers modeled pathways for European industry to achieve decarbonization while remaining competitive, focusing on electrification and green hydrogen. They found that relocating factories to sunnier or windier regions could help, but international cost competitiveness is highly sensitive to policy choices. The study is published in Cell Reports Sustainability.
The study models five energy-intensive sectors—steel, cement, ammonia, methanol, and plastics—within a full European energy system framework, rather than examining them in isolation. Researchers tested specific policy levers including factory relocation to regions with stronger solar or wind resources, importation of semi-finished green materials, and targeted subsidies.
The analysis suggests that importing partially processed green materials—such as iron—and completing final manufacturing within Europe could preserve jobs and expertise while reducing costs by up to 80 billion euros annually versus full domestic production. The authors emphasize that broad-scale expansion of energy-intensive industry within Europe would carry unrealistic costs, favoring instead a pragmatic approach centered on retaining existing capacity.
This research could inform EU policy debates where industrial competitiveness and climate commitments often appear in tension. If policymakers adopt the suggested approach, European workers in energy-intensive sectors may retain employment while emissions decline, though the strategy implies accepting greater reliance on imports for some materials. The findings could also shape how subsidies are designed, potentially limiting support to transitional periods rather than permanent industrial expansion.