Iron and Steel: The First ESPR Delegated Act

Steel is an unusual choice for a first delegated act, and the reasons it was chosen tell you a great deal about how the ESPR is expected to work in practice.

It is not a consumer product. Almost nobody scans a beam. The passport for steel exists to travel into other products, which makes it the clearest test of whether product data can move through a supply chain rather than sit at the end of one.

Why steel first?

• The emissions are large and concentrated, so the policy return per delegated act is high.
• The number of producers is small relative to consumer categories, which makes implementation tractable.
• Carbon intensity varies enormously by production route, so disclosure changes purchasing behaviour.
• Scrap content is already measured for commercial reasons, so one key field exists.
• It feeds construction, automotive and machinery, so one act reaches many downstream sectors.

The third point is the important one. Disclosure only changes behaviour when the disclosed quantity varies meaningfully between suppliers, and in steel it varies by a factor of several depending on how the metal was made.

What varies between production routes?

A purchaser choosing between routes is making a decision with a larger carbon consequence than most design changes available to them. That is precisely the situation where a mandatory declaration does useful work, and it is why the carbon footprint field is the one most likely to appear first.

What is the act likely to require?

The framework regulation sets out the parameters a delegated act may address. For steel the plausible set is narrower than for a consumer product, because durability and repairability have limited meaning for a material.

Composition deserves attention because it is not only a compliance field. Copper and tin contamination accumulates in the scrap pool and cannot be economically removed, which makes composition data a input to the recyclability of steel decades from now.

How does this interact with CBAM?

The Carbon Border Adjustment Mechanism under Regulation (EU) 2023/956 already obliges importers of iron and steel to report embedded emissions, and will require certificate surrender once fully in force.

That means many steel importers are already collecting emissions data at product level for a different instrument. The overlap is substantial and the definitions are not identical, which is the familiar pattern: two obligations, one underlying measurement, two collection exercises unless someone consolidates them deliberately.

Who holds the data?

The mill, almost entirely. Steel has a short chain relative to textiles or electronics: ore or scrap, then the mill, then processing and distribution. The consequential fields are all determined at the mill.

That is genuinely good news for downstream buyers. A fabricator needs data from a small number of mills rather than from hundreds of deep-tier suppliers, and mills serving EU customers have the scale to support a compliance function.

What makes steel data hard anyway?

Batching and mixing. Steel is produced in heats, distributed through service centres, and frequently sold from stock that combines material from multiple heats and sometimes multiple mills.

The mill knows what it produced. The fabricator often does not know which heat their material came from, because the distributor did not track it that way. Identity therefore breaks at the service centre rather than at the mill, which is a distribution problem rather than a production one.

What identity level does steel need?

Heat level is the natural unit, since a heat is the batch with uniform composition and a known production route. Item-level identity is meaningless for bulk material and unnecessary for the fields being declared.

That makes steel a batch-level passport case, and it fits the existing mill test certificate practice closely. The mill certificate already identifies the heat and its composition; the passport extends it with carbon footprint and recycled content and makes it resolvable rather than emailed as a PDF.

How does the passport travel downstream?

The second node is where most implementations will fail. Service centres are the weak link in steel traceability, and no amount of mill diligence survives a distributor that does not carry heat identity through its stock system.

What should a steel buyer do now?

1. Ask your mills what they can already declare, since many produce environmental declarations today.
2. Ask your service centres whether heat identity survives their stock process. Many will say no.
3. Check whether your CBAM reporting already captures a usable emissions figure.
4. Decide whether route disclosure will influence purchasing, because that determines whether the data changes anything.
5. Model what happens to your own product passports when a steel input has no declaration.

The second item usually produces the most surprising answer, and it is the one with the longest lead time to fix. Changing a distributor’s stock practice is slower than changing a mill contract.

What about green steel claims?

Low-emission steel is marketed under several names with no common definition, and the claims rest on very different mechanisms. Some describe a genuinely different production route; others describe a mass balance allocation of low-carbon output across a larger volume of conventional production.

Both can be honest and they are not equivalent. A buyer using an allocated figure in their own product footprint is reporting something different from a buyer whose steel physically came from a hydrogen-reduced route, and Directive (EU) 2024/825 now constrains how that difference may be described.

The passport helps here by carrying the mechanism alongside the number. A declaration that states the route and the custody model is checkable in a way that a single low figure with a certificate attached is not.

How does this affect construction specifically?

Structural steel is one of the largest contributors to embodied carbon in a building, and embodied carbon is becoming a regulated quantity in several member states independently of EU-level instruments.

A steel passport therefore arrives into a sector that already has a use for it. Where a national building code sets an embodied carbon limit, the designer needs supplier-specific figures rather than generic averages, and generic averages are what they have today.

The same data supports reuse. Structural steel is among the most reusable construction materials, and the barrier is rarely metallurgical — it is the absence of reliable provenance and property data for a section being removed from an existing building.

When will this actually apply?

No date is fixed. The working plan names the priority groups and the act follows, with roughly eighteen months between adoption and enforcement — the mechanism described in the ESPR delegated acts timeline.

The more useful planning assumption is that downstream customers will ask before any act obliges them to. Construction clients and automotive buyers are already requesting embodied carbon figures for steel, which means commercial demand arrives ahead of the regulation.