- New ETC report reveals financial viability of 'green' steel industry, claims that with concerted action, deeply decarbonized steel industry can start this decade
Demonstration in several markets of the viability of a business plan. Cooperation is urged to create the necessary conditions at the international level to accelerate investment
LONDON, April 5, 2023 /PRNewswire/ -- According to the latest report from the Energy Transitions Commission (ETC), viable investments in near-zero emissions primary steel projects can be made in Europe and North America, allowing place the steel sector on an emissions path aligned with the Paris Agreement by 2030.
Planned global production capacity from near-zero emissions primary (iron ore-based) steel projects needs to triple over the next three years to enable "green" production of 190 million tonnes per year (Mtpa) by 2030 and keep in sight the industry's emission reduction targets. "Unlocking the First Wave of Breakthrough Steel Investments: International Opportunities – The United Kingdom, Spain, France, and the United States" - reveals that practical industry and political action in four countries can ensure a viable investment case in those markets, creating the opportunity to grow the number of projects and accelerate existing proposals to final investment decisions (FIDs).
Steel is already responsible for 7% of annual greenhouse gas emissions and its demand is set to increase, since this material is essential for the energy transition, from wind turbines to electric vehicles, and for the growth of infrastructure in developing economies. Innovative iron and steel making technologies, centered on the use of low-carbon hydrogen to produce direct reduced iron (DRI), have been developed and offer a viable solution to decarbonizing primary steel.
Giving the green light to projects before 2026 is the most important challenge, given the execution deadlines, and the ETC report shows that the financial gap to do so is smaller than previously thought. All four countries may offer a viable investment case, especially in light of recent political developments, if urgent steps are taken to close the "last mile" gap. The main conclusions are the following:
The globalized nature of steel markets means that political support at the national level can have consequences for international trade. Concerted cooperation between governments and business is essential to ensure that these efforts do not lead to cross-border friction and instead create conducive conditions for investment internationally. The main areas of collaboration are:
Notes for editors:
Media Contacts:
· Caroline Randle, ETC – caroline.randle@systemiq.earth · Vicki Harding, ETC – vicki@devlo.global
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