Big steelmakers failing to make the switch to renewables, survey shows

HYUNDAI STEEL

29/11/2024 24:46

By David Stanway
       SINGAPORE, Nov 29 (Reuters) - The world's biggest
steelmakers are falling behind in the shift towards low-carbon
production, with some still entirely dependent on fossil fuels
for their energy, a survey of 18 leading firms showed on Friday.
    Steel is responsible for 7% of global carbon dioxide
emissions, around the same as India, with coal-fired blast
furnaces producing 2 metric tons of CO2 for each ton of output. 
    Alternative technologies are available, including electric
arc furnaces (EAFs) that can be powered with renewables, and
efforts are underway to produce iron using "green hydrogen"
rather than coal.  
    But some of the industry's biggest names still relied on
fossil fuels for 99% of their energy over 2022-2023, the
Sydney-based climate group Action Speaks Louder (ASL) said.
    Steel is considered a "hard to abate" sector, but the main
obstacle is affordability, said Laura Kelly, ASL's strategy
director and the survey's author. 
    "This messaging about 'hard to abate' is still implying it
is not technologically possible," she said. 
    The best performer was Sweden's SSAB  SSABa.ST , which
sourced 19% of its energy from renewables, while some of the
biggest laggards were in South Korea. 
    The share of renewables in the energy use of Hyundai Steel
 004020.KS , Dongkuk Steel  460860.KS  and Posco  005490.KS 
stood at zero or close to zero, even though they produce large
quantities of steel through EAFs. None of the firms responded to
requests for comment.
    Kelly said some firms have vested interests in maintaining
the status quo because of investments in fossil fuel
infrastructure, including import terminals and pipelines. 
    India's JSW Steel  JSTL.NS  sourced 0.4% of its energy from
renewables. It aims to run all its steel operations using clean
energy and waste gas by 2030, said chief sustainability officer
Prabodha Acharya. 
    Baosteel  600019.SS , China's biggest steelmaker, also
sourced 0.4% of its energy from renewables in 2022. The company
told Reuters it was drawing up new clean energy targets.   
    Steelmakers will come under growing pressure to shift to
cleaner energy as carbon pricing initiatives come into force.
    "If it is not hurting them financially now, it is hurting
them strategically because they are lagging on that transition
plan," Kelly said.

 (Reporting by David Stanway; Additional reporting by Amy Lv in
Beijing; Editing by Kim Coghill)
 ((david.stanway@thomsonreuters.com))