An analysis of the economic determinants of energy efficiency in the European iron and steel industry

As we find out, higher energy prices tend to raise energy efficiency (or tend to reduce specific energy consumption) in the steel sector. Yet, because lower specific energy consumption is related to higher total steel production, energy price increases might cause a kind of rebound effect, bringing about an increase in total production as a consequence of induced energy efficiency improvements. Taking this effect into account, the negative relation between input prices and total steel production is not very strong. In the short run, the wages of employees in the steel sector tend to have the biggest influence on total steel production. In the long run, GDP and investment climate exert the biggest influence.