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Manufacture of iron and steel under the EU Taxonomy
Steel is the backbone of the energy transition, and one of its largest emitters. The Taxonomy rewards two things: pushing conventional routes to best-in-class emissions intensity, and shifting production toward scrap-based electric arc furnace routes. Which thresholds apply depends on the production route, which is why route clarity is the first assessment question.
Why this activity matters
Iron and steel production is among the most emissions-intensive industrial activities in Europe, dominated by the blast furnace and basic oxygen furnace route. The Taxonomy takes a route-specific approach: integrated production is measured against tight intensity ceilings for each stage (hot metal, sinter, coke, cast steel), while electric arc furnace production is aligned when it combines an intensity ceiling with a high share of scrap input.
The commercial stakes are significant. Green steel commands attention across automotive, construction and energy supply chains; transition financing for decarbonisation projects (hydrogen DRI, EAF conversion, CCS) increasingly references Taxonomy alignment; and steelmakers within CSRD scope must report aligned turnover and CapEx. For investors, the route mix and the distance to threshold per production stage are the questions that matter.
What alignment requires
The criteria are route-specific: the applicable thresholds depend on how the steel is made. In summary:
| Area | What is required (summarised) |
|---|---|
| Integrated route (BF-BOF) | Stage-level specific emissions ceilings apply to hot metal, sintered ore, coke and cast steel. Each relevant stage must sit within its ceiling; these values are demanding and generally require best-available performance. |
| Electric arc furnace (EAF) | Intensity ceilings apply per product family (carbon steel vs high-alloy), combined with a requirement that a high share of the metallic input is scrap, rewarding circular, electricity-based production. |
| Direction of travel | Lower-carbon routes (scrap-EAF, and progressively hydrogen-based reduction) sit naturally closer to alignment; conventional routes typically need efficiency measures or capture to reach the ceilings. |
Summarised for orientation; the assessment itself applies the full criteria text of the Delegated Acts as amended.
Where DNSH scrutiny falls
BAT-AEL compliance for the relevant installations (sinter plants, coke ovens, furnaces), covering dust, NOx, SO2 and other listed pollutants.
Cooling and process water management, discharge quality, and water sourcing in stressed catchments.
Scrap utilisation, by-product management (slag), and residue handling.
CRVA proportionate to long-lived heavy industrial assets, with implemented adaptation measures.
Documentation that typically supports the assessment
- Verified specific-emissions data per production stage or per product family (EU ETS reports or equivalent)
- Production route breakdown and scrap input share (for EAF routes)
- Permit and BAT compliance documentation with measured emissions data
- Climate risk and vulnerability assessment
- Environmental and energy management certifications (ISO 14001 / 50001)
- Decarbonisation or transition plan where CapEx alignment is the objective
How Censatim assesses it
The first thing our assessment establishes is the production route, because it determines which thresholds apply; the questioning then targets the stage-level or product-level intensity figures and the scrap share where relevant, before working through the DNSH areas. Multi-route sites are assessed per route, which is also how reporting allocation works in practice.
Censatim is an expert-built EU Taxonomy assessment tool: describe the asset or activity in plain language, upload supporting documents, and answer a short set of targeted questions. The result is a criterion-by-criterion view with an In-line / Partial / Not aligned / Undetermined rating and a confidence level for each dimension. See the full methodology.
Frequently asked questions
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