ArcelorMittal, the world's largest steel maker, will benefit from a windfall of £1 billion (Rs 7,000 crore), thanks to the carbon credits issued to it under the European Trading Scheme. The Sunday Times reported that ArcelorMittal will be the single largest beneficiary under the ETS due to its dominant presence in Europe.
Under the ETS, companies are issued permits called carbon credits that allow them to emit carbon dioxide and other greenhouse gases with a specified cap. Any emission above this cap will have to be bought by the companies by buying globally traded carbon credits.
According to The Sunday Times, ArcelorMittal has been issued carbon credits far in excess of its requirements. This would allow the company to sell these credits, thus providing a windfall estimated at £1 billion by 2012.
"The investigation has also shown that ArcelorMittal and Eurofer, which represents European steel makers at the European level, have lobbied intensively in Brussels. This has included threatening to move plants out of Europe at a cost of 90,000 jobs, and asking European commissioners to meet Mittal," the report said.
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 at today's prices for scant effort. For them, the ETS has been turned into a system for generating free subsidies."
Luxembourg-based ArcelorMittal (controlled by India-born Lakshmi Mittal) is the world's number one steel company, present in more than 60 countries and with more than 80 steel plants around Europe. ArcelorMittal's key financials for 2008 show revenues of $124.9 billion and crude steel production of 103.3 million tonnes, representing approximately 10 per cent of world output.
Carbon credits have been a controversial subject, with climate warriors across the world terming it immoral, and an idea that allows prospective polluters to make money out of it.
