Commission recognises competitive threats to chlorine industry by high electricity prices

Wednesday, January 29, 2014

The Commission concludes: “Electricity price is a crucial driver for chlorine production costs, affecting the competitiveness of the industry”.

On 22nd February, the Commission published a number of documents in preparation for the Competitive Council in February and the Heads of State Summit Meeting in March. The documents made ecommendations on the 2030 climate goals and for the future of shale gas as well alluding to the review of the carbon leakage list.

Of particular interest to manufacturing industry was a hefty report on Energy Prices and Costs. Mixed conclusions are made but it clearly states that “The results confirm the vulnerability of energy intensive
industries in particular those that are exposed to foreign competition, such as metals and chemicals”.

More specifically based on input from Euro Chlor member companies via a report carried out by CEPS on behalf of DG Enterprise, the report concludes that “Electricity price is a crucial driver for chlorine production costs, affecting the competitiveness of the industry”.

Euro Chlor Executive Director Alistair Steel said: “Whilst this recognition of the competitive threats to our industry from those regions outside of Europe with access to considerably cheaper electricity and feedstock
does not solve the problem we face, it is a start on the journey to work with the Commission, EU parliament and Council to restore the competitiveness of our industry.”

In addition, Steel said “I take this opportunity to thank the members who responded to the call to participate in the study in the autumn of 2013. This is a marvellous example of how collective efforts can achieve positive results for the whole chlor alkali sector.”

The Heads of State will discuss the subject of European competitiveness in March where they will be invited to adopt a target of 20% manufacturing share of European GDP – an increase from the current level of 15.1%.

Read the Commission’s communication on this issue here.

Consult the full energy prices and cost report here: check statements about the chlorine sector on pages 153, 159 and 161.

Contact: Alistair J Steel, Executive Director, tel. +32 2 676 73 50