Corus TCP plant buyer’s carbon bonus

Feb 26 2010 by Kelley Price, Evening Gazette

CORUS will include carbon credits for the Teesside Cast Products plant in talks with potential new buyers.

The steelmaker was awarded seven million free carbon credits this year, under the EU’s Emissions Trading Scheme (ETS) - currently worth almost 80 million euros on the open market.

Most of the credits will go unused after production ceased at the Teesside plant.

The credits will form a key part of ongoing negotiations between Corus and three prospective buyers for the Teesside Cast Products (TCP) site.

The steelmaker has strongly denied speculation that Teesside’s plant was mothballed so it could profit by selling unused carbon credits.

A Corus spokesperson said: “Carbon credits required for a restart will be part of the negotiations with a new buyer.

“The EU ETS is an open system, we have to operate under its rules and that’s what we are doing.

“The current system makes us - and all other carbon emitters affected by the recession - vulnerable to criticism. Because of the recession, we are emitting much less than we otherwise would.

“The system is set up to reward carbon reductions. We would have preferred a system that takes account of variations in production levels, but that kind of system does not deliver a cap on emissions, and it was decided that the system needed to deliver a cap.

“European steel has a big imposition on it. No other steel industry in the world is in that position.”

Corus is also in line to receive a further free allocation of seven million credits in 2011 and again in 2012. What will happen to the credits is unknown.