Transforming steel production
The production of steel remains a CO2 and energy-intensive activity. However, the steel industry is committed to continuing to reduce the footprint from its operations and the use of its products.
Our industry fully supports the aims of the Paris Agreement.
There is no single solution to drastically reducing CO2 emissions from our industry, however, the main elements enabling industrial and societal transformation are:
Key points from this policy paper
Being responsible - Reducing our own impact
The IEA Iron and Steel Technology Roadmap
In October 2020, the International Energy Agency (IEA) released its Iron and Steel Technology Roadmap3. This document analyses the impacts and trade-offs of different technology choices and policy targets for the industry to be in line with the goals of the Paris Agreement.
Under the IEA’s Sustainable Development Scenario, total direct emissions from the iron and steel sector fall by more than 50% by 2050 relative to 2019. On the same pathway, the emissions intensity of crude steel production must fall by 58%.
The IEA states that steel is vital to modern economies and notes that sustaining the projected demand growth in steel while reducing emissions poses immense challenges. While efficiency improvements will help the industry, there is a need to develop further and deploy a broad portfolio of breakthrough technology options and enabling infrastructure to achieve long term, deep reduction in emissions.
Furthermore, the IEA notes the critical role governments must play in ensuring a sustainable transition of the sector, and concludes with a call to action for governments, the steel industry, the research and NGO communities and other stakeholders.
Reducing our impact: three components
Steel production, total CO2 emissions and CO2 intensity, 2019 – 2050 under the International Energy Agency (IEA) Sustainable Development Scenario (SDS)
2. Maximise scrap use
Scrap plays a key role in reducing industry emissions and resource consumption. Every tonne of scrap used for steel production avoids the emission of 1.5 tonnes of carbon dioxide, and the consumption of 1.4 tonnes of iron ore, 740 kg of coal and 120 kg of limestone6.
The future expansion of scrap-based steel production will depend on the availability of high-grade scrap. While iron ore supply can flex with demand, global scrap availability is a function of steel demand and the arising of scrap when steel-containing products reach the end of their life. Global steelmaking capacity experienced a phase of explosive growth from the early 2000s largely fuelled by investment in new capacity in China. With steel products having an average lifespan of 40 years7, this steel will begin to enter the scrap market in the next decade, enabling a significant reduction of steel industry emissions.
3. Breakthrough technology
Currently, the only technically and commercially feasible way to produce steel from iron ore8 is through the use of fossil fuels as reducing agents.
The blast furnace is the dominant technology used to reduce iron ore today. The modern blast furnace is continually being developed and refined and currently operates close to the efficiency limit of the reduction process. Therefore, to achieve the drastic reductions needed, an entirely new, transformative approach to ironmaking is required and there are several promising initiatives under development. These fall into three broad categories:This reliance on fossil fuels defines the steel industry’s past as a major emitter of greenhouse gases, but we are committed to a low-carbon future.
A portfolio of technology options
Climate Action
The IEA roadmap projects that the broad deployment of breakthrough technology will accelerate between 2030 and 2050. However, we can expect to see first movers trial and implement first of a kind plants providing increased quantities of low-carbon steel to the market from the mid-2020s. Learnings from these innovations will support broader deployment across the wider industry by mid-century.
Cost implications
Partnerships between governments and the steel industry are fundamental to a sustainable future
In practice this means that: