Customers drive emissions reduction, technology shift: British Steel
Customers are driving the emissions reduction efforts and technology shift by steelmakers, according to Chris Vaughan, technical director at British Steel.
“It’s important to reflect the reasons why we are shifting is a primary drive to drive down CO2 emissions, and the way that we are governed on that. It’s policy that’s driving it, it’s public perception, but the pace of change that’s really driving the removal of emissions and taking those to another level is the customer base,” he said at last week’s UK Metals Expo attended by Kallanish.
“Customers are driving the manufacturers to decarbonise as quickly, if not more quickly than the policy timescales with 2035 and net zero by 2050,” he added.
British Steel has a £1.25-billion ($1.65 billion) decarbonisation plan to shift away from blast furnaces to electric arc furnace, with planning permission for this secured in Scunthorpe and Teeside earlier this year.
Vaughan noted some of the challenges the firm is facing came from the customer base potentially switching to materials other than steel which lower emissions.
“They would consider other materials for construction, etc, if we are unable to decarbonise quickly enough to meet the aspirations of their timelines,” he said.
“The transition for us is about reduction in emissions. From a British Steel perspective and an integrated manufacturer currently, the vast majority of our emissions sit within scope 1, so when we talk to clients and customers and they’re looking at us to decarbonise their own downstream, it sits in their scope 3, but their scope 3 is our scope 1,” he added.
The move to EAF-based steelmaking makes sense for the UK, but other global locations may better suit other technologies. “There’s a set of circumstances that fit electrification for the UK and the drive towards EAF, but EAF is not the only technology and it will not be the only technology on a global scale for decarbonisation,” Vaughan observed.
“Globally, it’s got to be considered from geography, where you are in your economic cycle, what is the raw material access … where’s the infrastructure as well to allow that decarbonisation,” he continued.
Amid the UK-wide move away from blast furnaces, much of the conversation has focused on whether EAF technology will be sufficient for grades that have traditionally been produced via primary steelmaking.
“It’s been around a long time. We have domestic producers using EAF technology and have done for decades. It’s proven technology which we can capitalise on to help that shift,” he added. “All grades can be made from that [EAF] route; it’s what you feed the furnace, and the raw material input that drives that, in around working with the supply chain to achieve it as well.”
He also noted that EAF steelmaking would allow more flexibility. “Our current method within British steel on integrated production requires stability, it’s not easy to take capacity up and down … whereas the EAF allows you to respond more dynamically and flexibility to market requirements which gives the benefit to be able to tune your operation to what you’re facing from the market perspective,” Vaughan concluded.
Carrie Bone UK
MEPs: Put a carbon price on certain EU imports to raise global climate ambition
To raise global climate ambition and prevent ‘carbon leakage’, the EU must place a carbon price on certain imports from less climate-ambitious countries, say MEPs.
On Wednesday, Parliament adopted a resolution on a WTO-compatible EU carbon border adjustment mechanism (CBAM) with 444 votes for, 70 against and 181 abstentions.
The resolution underlines that the EU’s increased ambition on climate change must not lead to ‘carbon leakage’ as global climate efforts will not benefit if EU production is just moved to non-EU countries that have less ambitious emissions rules.
MEPs therefore support to put a carbon price on certain goods imported from outside the EU, if these countries are not ambitious enough about climate change. This would create a global level playing field as well as an incentive for both EU and non-EU industries to decarbonise in line with the Paris Agreement objectives.
MEPs stress that it should be WTO-compatible and not be misused as a tool to enhance protectionism. It must therefore be designed specifically to meet climate objectives. Revenues generated should be used as part of a basket of own revenues to boost support for the objectives of the Green Deal under the EU budget, they add.
Mechanism to be linked to a reformed EU Emissions Trading System (ETS)
The new mechanism should be part of a broader EU industrial strategy and cover all imports of products and commodities covered by the EU ETS. MEPs add that already by 2023, and following an impact assessment, it should cover the power sector and energy-intensive industrial sectors like cement, steel, aluminium, oil refinery, paper, glass, chemicals and fertilisers, which continue to receive substantial free allocations, and still represent 94 % of EU industrial emissions.
They add that linking carbon pricing under the CBAM to the price of EU allowances under the EU ETS will help to combat carbon leakage but underline that the new mechanism must not lead to double protection for EU installations.
You can watch a video of the plenary debate here.
Quote
After the vote, Parliament rapporteur Yannick Jadot (Greens/EFA, FR) said:
“The CBAM is a great opportunity to reconcile climate, industry, employment, resilience, sovereignty and relocation issues. We must stop being naïve and impose the same carbon price on products, whether they are produced in or outside the EU, to ensure the most polluting sectors also take part in fighting climate change and innovate towards zero carbon. This is our best chance of remaining below the 1.5°C warming limit, whilst also pushing our trading partners to be equally ambitious in order to enter the EU market.
Next steps
The Commission is expected to present a legislative proposal on a CBAM in the second quarter of 2021 as part of the European Green Deal as well as a proposal on how to include the revenue generated to finance part of the EU budget.
Background
Parliament has played an important role in pushing for more ambitious EU climate legislation. It declared a climate emergency on 28 November 2019 and wants the EU and its member states to become climate neutral in 2050 and reduce GHG emissions with 60% by 2030.
Source: europarl.europa.eu