Publication Date:
2023-06-28
Description:
The aim of this study is to assess decarbonization pathways for the German steel industry and to analyze the effect of relocation of industrial production. Green leakage is the migration of industry from one country to another due to more advantageous location factors, including more favorable renewable energy costs, to serve emerging markets for green products. Importantly, green leakage, unlike carbon leakage, has a low risk of interfering with efforts to reduce emissions. One key factor incentivising green leakage is the Renewables Pull. The Renewables Pull describes the incentive to relocate production due to different costs for green energy sources between two countries. The Green Leakage risk for the German steel industry is analyzed by quantifying the Renewables Pull and investigating other preventing and promoting factors through semi-structured interviews. The result is that there is a risk of Green Leakage in the German steel industry due to the Renewables Pull. The main reason is that the steel industry is electrified in the course of decarbonization, which leads to a high demand for green electricity. Inexpensive green electricity thus becomes a locational advantage for steel production. However, the Renewables Pull is not the only factor considered. Other inhibiting factors such as rising transport costs due to increasing distances between producer and customer, a higher willingness to pay in the country of origin or government subsidies to prevent migration can compensate for the Renewables Pull.
Language:
German
Type:
info:eu-repo/semantics/masterThesis
Format:
application/pdf
