An Action Plan for
European Aluminium:

Strategic Metal, Strategic Action

#Aluminium4Europe

Why do we need an Aluminium Action Plan?

Aluminium is officially recognised by the EU as a critical and strategic raw material, being the backbone of Europe’s green transition and critical sectors like automotive, packaging, building, aerospace, defence, and renewable energy technologies. From powering solar panels to enabling electric grids, aluminium is indispensable to achieving the EU’s climate and resilience goals. Europe leads the way in sustainable aluminium production, with state-of-the-art recycling facilities and a carbon footprint significantly lower than the global average, but the industry is under threat.

High energy costs, unfair trade practices, the risk of accelerated carbon leakage posed by the CBAM, aluminium scrap leakage, and the urgent need to accelerate decarbonisation are pushing this vital sector to a breaking point. Without immediate action, Europe risks completely losing a critical industry and its strategic autonomy.

The Clean Industrial Deal’s flagship legislative proposals—including the forthcoming Industrial Accelerator Act and Circular Economy Act—together with the EU Steel and Metals Action Plan, provide important horizontal frameworks. However, aluminium’s distinct challenges and opportunities require a sector-specific approach and effective policy measures to tackle deindustrialisation, accelerate decarbonisation, and ensure aluminium remains a pillar of Europe’s green and industrial future.

Download the Aluminium Action Plan

Below, we outline five essential steps to strengthen and grow Europe’s aluminium value chain and its contribution to the EU’s strategic goals.

+30%

Demand by 2040 due to the green transition *compared to 2022

>50%

of European demand met by imports

+1M

Direct & indirect European jobs on the line

5Essential
Steps

#Aluminium4Europe
  • 1.

    Tackle Energy Costs & Support Decarbonisation

    The European aluminium industry faces significantly higher energy costs than global competitors. Restoring competitiveness depends on secure and reliable access to affordable, low-carbon energy. This requires removing barriers to Power Purchase Agreements, upgrading grid infrastructure to better match variable renewable generation with industrial baseload demand, accelerating investment in decarbonised electricity, and strengthening support for hydrogen solutions where industrial processes cannot be electrified. In parallel, maintaining electricity surcharge reductions, extending financial relief for energy-intensive industries, implementing a specific ETS benchmark for recycling and ensuring the continuation of ETS indirect cost compensation beyond 2030 are essential to protect competitiveness.

    Achieving a 93% emissions reduction by 2050 will require at least €33 billion in investment (excluding R&D and infrastructure), yet the industry faces a substantial subsidy gap compared to global competitors. Securing long-term competitiveness therefore depends on mobilising both public and private investment through a coordinated European approach, leveraging new and existing EU instruments such as the EU Competitiveness Fund and the ETS Innovation Fund.

    EU primary aluminium production halved since the energy crisis

    Electricity and gas prices in Europe are 2-3x & 4-5x higher than in the US

  • 2.

    Strengthen Carbon Leakage Protections

    The Carbon Border Adjustment Mechanism (CBAM) in its current design does not provide carbon leakage protection for the aluminium industry. The CBAM review must address circumvention risks and close existing loopholes, ensuring that it does not undermine the competitiveness of European producers or contribute to carbon leakage. We welcome the European Commission’s proposal to extend the scope to downstream products while keeping indirect emissions out of scope, and this approach must be maintained throughout the review. Additionally, rapid action is needed to ensure that all aluminium in the CBAM scope carries a CBAM cost based on emissions from primary aluminium production, independently of the scrap content (both pre- and post-consumer scrap). A dedicated export solution tailored to the aluminium sector should also be introduced.

    Complementary measures are also essential for safeguarding the sector’s competitiveness. These include continuing indirect cost compensation for exposed industries beyond 2030, as well as expanding the European Contracts for Difference scheme to support innovative low-carbon aluminium production and circularity.

    6.6 CO₂/kg

    The carbon footprint of Europe's primary production is less than half the global average of 14.8 kg CO₂/kg

  • 3.

    Secure Raw Materials & Boost Circularity

    A coherent EU approach to strategic raw materials and circularity is key for the future of Europe’s aluminium sector. Effective implementation of the Critical Raw Materials Act is crucial to scaling both primary and recycling domestic production and securing the European aluminium value chain. To leverage and support investments, this should be backed by financing mechanisms such as a dedicated Raw Materials Fund and State Aid, with additional support from the European Investment Bank.

    The forthcoming Circular Economy Act should establish a long-term strategy for the availability and quality of secondary raw materials, supported by strengthened collection and sorting infrastructure, enhanced monitoring systems, and a regulatory framework that boosts aluminium recycling in Europe. Recycling aluminium uses just 5% of the energy required for primary production, effectively turning scrap into an energy “bank” that should be retained within Europe.

    On top, complementarity and alignment on circularity provisions should be ensured with key product-specific legislation, such as the Packaging and Packaging Waste Regulation, the End-of-life Vehicles Regulation, the Construction Product Regulation, and the upcoming provisions for aluminium under the Ecodesign for Sustainable Products Regulation.

    In parallel, the aluminium scrap export measure announced by the European Commission in November 2025 must be effectively designed, implemented, and enforced to address the growing leakage of aluminium scrap outside the EU.

    +1 million tonnes of scrap exported outside of the EU annually 

  • 4.

    Stand Firm on Trade

    Unfair practices, such as China’s state-sponsored overcapacity, pose a significant threat to the aluminium industry. Strengthening and, where necessary, expanding EU trade defence instruments to counter dumping and systemic risks is essential.

    This includes establishing a dedicated instrument to address structural overcapacity and unfair market practices affecting the European aluminium industry, in line with the new trade protective measures mentioned in the European Economic Security Strategy. Additionally, a sectoral approach to Free Trade Agreements is needed to protect Europe’s strategic industries from unfair competition.

    60%

    of global primary aluminium production is based in China

    ∼17MT

    Chinese overcapacity in aluminium metal supply (i.e. primary & recycling). This is bigger than the total EU metal demand.

    ∼20MT

    Chinese overcapacity in semi-transformation (e.g., rolling and extrusion). This is 3.5 x bigger than the EU demand.

  • 5.

    Support Products "Made in Europe"

    Strengthening Europe’s industrial base requires targeted support for products manufactured in Europe, underpinned by timely financial support for electrification and circularity, as well as further reforms of the EU State Aid framework. Effective implementation of the Net Zero Industry Act and the Critical Raw Materials Act is also essential for the sector’s transformation.

    This should go hand in hand with an effective Industrial Accelerator Act that supports products made in Europe through a full value chain approach, ensuring that aluminium Made in Europe reflects genuine industrial activity and technological investment in Europe, rather than merely the origin of raw inputs.

    +33B

    investments needed to meet 2050 climate targets

    Aluminium is one of NATO’s 12 defence-critical materials

The Stakes are High, the Solution is Clear

We call on the new European Commission to embed these recommendations in a bold, comprehensive Aluminium Action Plan. By acting decisively, Europe can secure the future of this essential sector and lead the world in sustainable industrial innovation.