An Approach to Interoperability of U.S. and EU Systems for Determining GHG Emissions Intensity of Steel

In October 2021, the U.S. and EU announced their intent to negotiate a “Global Arrangement on Sustainable Steel and Aluminum” that would restrict market access for high carbon intensity steel and aluminum. In the years since, there’s been little agreement on which methodologies and data should be used to determine emissions intensity if the deal goes through.

This working paper outlines a new approach for coordinating product-level emissions accounting procedures under the Global Arrangement to provide both flexibility and interoperability.

• Most proposals for promoting interoperability of standards focus on a “vertical,” top-down system based on international standards.
• We propose as an alternative a “horizontal” approach linking the methodologies that are already being developed in the U.S. and the EU.
• The goal of our proposal is to reduce burdens on covered steel manufacturers in generating emissions intensity data that would comply with both U.S. and EU requirements.