ArcelorMittal, Nippon help set industry framework for steel emissions cuts

Steelmakers ArcelorMittal, Nippon Steel, POSCO, Severstal and industry associations have set industry recommendations for steel emissions cuts, to help meet net-zero targets over coming decades and contribute to the Paris Agreement on emissions.

The steel industry participants plan to adopt science-based targets in frameworks for moving toward net-zero emissions, ResponsibleSteel said in a statement, unveiling the broader group’s new report July 26.

Fifteen international steel companies, Brussels-based World Steel Association and Germany’s WV Stahl participated in the Net-Zero Steel Pathway Methodology Project, or NZSPMP’s, final report and recommendations, steel benchmarking organization ResponsibleSteel said.

No Chinese steel industry groups individually participated in the report, while worldsteel includes several major Chinese steel companies as members. Steel is the second-largest industrial contributor to emissions, with over half global steel production in China, and the country accounting for two thirds of emissions-intensive pig iron production via blast furnaces, using iron ore and metallurgical coal.

The report “sets out a framework for developing robust guidance for those in the sector who wish to make a realistic and credible commitment to the Paris Agreement, with a net-zero or ‘science-based target’,” ResponsibleSteel said.

The steel industry “has to reduce its net greenhouse gas emissions to zero within the next 30 years,” ResponsibleSteel CEO Anne-Claire Howard said in the statement. “Every steel company needs to plan its own pathway to achieve this, and to do so urgently.”

The NZSPMP report’s recommendations will help steelmakers in consistently measuring and setting company level emissions reduction targets, it said.

A greater usage of ferrous scrap, and new hydrogen-based iron and steel production plans, which are expected to slash emissions, may need to be complemented by industry process optimisation. New recycling measures, such as carbon-based byproducts, as well as cutting-edge iron ore processing and molten oxide electrolysis, may be pursued.

“To decarbonize the steel industry, we have to decarbonize the primary industry,” ArcelorMittal’s EVP Brad Davey said. “That is really what will drive the path to net zero as there is not enough scrap available to move to a truly scrap-based industry until the end of this century.”

Key recommendations

The key recommendations for greenhouse gas emissions reduction targets are to “differentiate between primary and secondary steel; set a consistent scope and system boundary; establish a consistent steel sector budget and trajectory; and acknowledge greenhouse gas emissions reduction from using co-products made by the steel industry.”

Further, the recommendations include integrating the influence of regulatory policy when setting a science-based target, leveraging existing standards and methods into a dedicated steel sector decarbonization approach, and developing unambiguous guidance related to different types of steel products.

Steelmakers with operations in Europe, Asia-Pacific and the Americas regions, including steering group members Tata Steel Europe, ArcelorMittal, GFG Alliance and BlueScope Steel, as well as JSW, Ternium, Voestalpine and NLMK, contributed over the past year to help define the report’s recommendations, it said.

“These recommendations are urgently needed as the steel sector currently emits between 7%-9% of global CO2 emissions annually,” ResponsibleSteel said. “However, steelmakers will not be able to achieve net-zero on their own. Significant support will be needed from both investors and policy makers to create the right environment for the massive and long-term investment required to make the structural changes needed.”

Tata Steel Europe, which targets reducing steel emissions in Europe by 30%-40% by 2030, over the coming years plans to make “significant investments” to decarbonize, said Tata Steel Europe’s director for sustainability Annemarie Manger.

The Paris agreement aims to substantially reduce global greenhouse gas emissions, limiting global warning to 2 degrees Celsius above preindustrial levels.

“We are preparing various decarbonization options including hydrogen-based steel production technology and, especially in support of more rapid decarbonisation, carbon capture, storage or utilization,” Manger said. “Decarbonizing the steel sector will need action not just from us and other steelmakers, but governments, policy, makers, markets and other stakeholders, including civil society, who will all need to work together to solve the challenge.”

— Hector Forster