Cembureau warns of EU plant closures

In light of rising energy prices across Europe, CEMBUREAU has issued advice for its members to help support energy-intensive industries and households alike. According to CEMBUREAU, a 10-fold increase in electricity prices compared to last year has led to a tripling in the cost of producing cement. “Unless urgent actions are taken at both European and national level, the current energy prices will lead to widespread plant closures across the EU, creating a crisis in the construction supply chain,” warns the association.

In the short-term, CEMBUREAU suggests that all available sources of electricity generation should be used to boost power supplies. Emergency measures, including energy price caps, should also be implemented immediately. The EU temporary state aid framework adopted in late March 2022 should allow all energy-intensive industries to have access to state aid covering 70-80 per cent of eligible costs, and co-processing in cement kilns should be actively encouraged.

It also calls on the following measures to be urgently considered. The electricity market design rules, including the marginal price setting mechanism, should be changed to prevent further electricity price hikes in the future. The cement sector should also be made eligible for financial compensation under the EU ETS indirect state aid guidelines. The large-scale deployment of renewable energy should be supported across the EU through faster permitting measures and grid infrastructure deployments. Finally, the pace of the EU climate agenda (‘Fit for 55’) should be maintained, and the Carbon Border Adjustment Mechanism (CBAM) should be implemented in a timely manner.