London, Dec 6 (IANS) ArcelorMittal, the steel giant headed by Indian billionaire Lakshmi Mittal, stands to gain around a billion pounds from a European scheme aimed at curbing global warming, a newspaper reported Sunday.
ArcelorMittal, the world’s largest steelmaker of which Mittal is chairman and main owner, will make the gain on ‘carbon credits’ that are given to companies under the European Union Emissions Trading Scheme (ETS).

The ETC grants European-based companies ‘permits’ to emit carbon dioxide, which is among greenhouse gases that cause climate change, up to a specified limit. Companies are also allowed to buy and sell unused permits on the open market.

ArcelorMittal could make at least &pound1 billion by 2012 by selling its unused permits, the Sunday Times reported, quoting an investigation by a campaigning NGO.

The eventual value could be much greater than &pound1 bn pounds as the European Union wants to drive the price of each carbon permit from the current &pound12.70 to above &pound30, according to ETS specialist Anna Pearson of Sandbag.

“Between 2008 and 2012 ArcelorMittal stands to gain assets worth &pound1 billion at today’s prices for scant effort. For them, the ETS has been turned into a system for generating free subsidies,” said Pearson, who analysed the Community Independent Transaction Log for carbon permits issued to European factories and power stations.

“Following intense lobbying and claims that the scheme would harm business, the cap on emissions was set too high and too many permits were issued,” said Pearson.

ArcelorMittal was given the right to emit 90 million tonnes of CO2 each year from its European plants from 2008 to 2012 but emitted 68 million tonnes last year, partly due to a global decline in the demand for steel.

This year ArcelorMittal’s emissions are predicted to plummet to 43 million tonnes, the newspaper said.

A spokesman for the company said: “The extra surplus arose when actual steel production fell way below forecasts because of the unexpected global economic crisis. As the world returns to growth, we expect to use them up.”

But Pearson estimates that by 2012 the company will have accumulated surplus permits for 80 million tonnes of CO2 - equivalent to the pollution generated annually by the whole of Denmark.