ArcelorMittal may reconsider future in Ukraine over high electricity costs

Metallurgical giant ArcelorMittal has raised concerns over skyrocketing electricity prices in Ukraine, with the company even considering reassessing its long-term presence in the country. In an interview with Delo.ua, Mauro Longobardo, CEO of ArcelorMittal Kryvyi Rih, said electricity costs have risen to such an extent that they threaten the company’s competitiveness.

"[The cost of electricity] have increased significantly. We consume 250 MWh, and our additional electricity expenses now amount to $200 million per year. Prices are so high that they make our business uncompetitive — even higher than in Europe. This is the case even during off-peak seasons. For example, from May to June, when temperatures are mild, prices should drop. Yet in June, our average electricity price was $135/MWh. By contrast, in the EU, prices are often below $100/MWh, and in countries with nuclear power — such as France — the price is as low as $40/MWh," Longobardo said.

Steel prices, he noted, are set on the global market, leaving the company unable to pass on additional energy costs to customers. As a result, ArcelorMittal is calling for government intervention.

"We don’t object to energy companies earning a margin, but when the production cost is $10 and we’re being charged $135, that’s simply unacceptable. That’s money we should be investing to keep our operations running," he emphasized.

Longobardo warned that without government action, ArcelorMittal Kryvyi Rih is likely to post another annual loss.

"And we may have to reconsider our future in Ukraine," he added.

While reaffirming the group’s commitment to Ukraine — including a $1 billion injection from the parent company — Longobardo stressed the need for broader structural support.

"We are committed to staying, but others must also move in the same direction. We can’t continue investing while others take advantage," he said.

To reduce dependence on the grid, the company is exploring renewable energy projects, including wind turbines and solar panels. However, these would not fully meet the plant’s energy needs.

Another option under review is the construction of a small modular nuclear reactor in partnership with Ukraine’s Energoatom.

"We’ve held discussions with Energoatom about this idea. They are now identifying suitable locations. We are very interested, but it’s still at a very early stage — and such a project would take at least five years to complete," Longobardo said.

• This isn’t the first time ArcelorMittal has had to scale back due to energy prices. On June 20, the company abandoned plans to produce green steel in Germany, citing high electricity costs.
• Earlier, in early 2025, it suspended operations in Romania for the same reason.