Located in Ukraine, ArcelorMittal Kryvyi Rih plant is bearing the heavy burden of wartime along with the brave country fighting for its existence.
“However, today we are forced to talk about another front – the economic one, where the situation is becoming critical,” says Mauro Longobardo, CEO of ArcelorMittal Kryvyi Rih. “Since July, ArcelorMittal Kryvyi Rih has openly declared the devastating cumulative effect of the increase in the cost of energy resources. Back in summer, we emphasized: the cost of electricity for industry in Ukraine has become the highest in Europe, reaching $ 135 per MWh, taking into account transportation and distribution. Even then, we warned that no energy-intensive industry can survive when electricity prices are three times higher than in European countries”.
“I must state: since then, the situation has only worsened. Instead of support, we see new plans from the regulator. The National Commission for the Regulation of Energy and Power Generation and Energy of Ukraine intends to increase tariffs for 2026 again: for natural gas distribution – up to 128%, and for electricity transmission – up to 14.6%”.
“The situation is complicated by the enemy’s constant attacks on the energy infrastructure. Our plant operates in conditions of capacity shortage. I am proud of our miners and metallurgists, who adapt production to the availability of electricity in real time. We are coping thanks to the steely character of the people of Kryvyi Rih. But there are things that cannot be overcome by strength of mind alone”.
“The biggest threat to our business remains the uncontrolled increase in the cost of electricity, which is killing our competitiveness in global markets. When local generation is lacking due to shelling, we are forced to import electricity. In December, this led to a sad record: the price for our plant reached $220 per MWh. Such costs are unsustainable even in the short term”.
“Meanwhile, our colleagues in the EU are acting differently. In Germany, industrialists are pushing the government to introduce a fixed tariff for industry. It is expected that until early 2026, German plants will receive a tariff of 50 euros per MWh. Compare this with our figures”.
“Our plant has been unprofitable since the start of the full-scale war. The planned increases in electricity and gas tariffs will mean additional costs for us of more than UAH 490 million (excluding VAT). The consequences could be fatal: we will have to suspend or permanently stop the operation of some production units”.
“That is why we are appealing to the National Commission for the Regulation of Energy and Power Generation not to increase tariffs. To contain the cost of electricity, Ukrainian industry urgently needs support measures from the government, similar to those being implemented in Germany. We are not asking to reinvent the wheel. If European producers operating in peacetime demand immediate action from their governments, then the needs of the Ukrainian metallurgical and mining industries operating in wartime must be taken into account as a priority”. (Energobiznes)