Selling carbon credits could make ArcelorMittal a billion pounds richer: report
07 Dec 2009
ArcelorMittal, the world's largest steel maker, could make windfall gains of 1 billion pounds (Rs7,000 crore) by selling carbon credits issued to it under the controversial European Trading Scheme, according to a Sunday Times report that was widely picked up by the media.
The paper's investigations show that ArcelorMittal has been issued far more carbon credits than it needs. This is the result of intense lobbying by ArcelorMittal and Eurofer, which represents European steelmakers, in Brussels, the European Union headquarters. They threatened to move plants out of Europe at a cost of 90,000 jobs, says the report.
Under the ETS, companies are issued permits called carbon credits that allow them to emit carbon dioxide and other greenhouse gases up to a specified cap. Beyond this, they must by extra permits, which can be traded globally.
The scheme has drawn much flak from environmentalists, who say it merely 'exports' emissions to other countries without curtailing them globally. They say it is immoral, as it allows prospective polluters to make money out of polluting. ArcelorMittal's apparently arm-twisting methods of getting extra carbon credits does not help the credibility of the scheme.
Anna Pearson, an expert on the ETS who carried out the analysis, said, ''Between 2008 and 2012, ArcelorMittal stands to gain assets worth 1 billion pounds at today's prices for scant effort. For them, the ETS has been turned into a system for generating free subsidies.
''Following intense lobbying and claims that the scheme would harm business, the cap on emissions was set too high and too many permits were issued,'' said Pearson.
