Steelmakers stress performance basis for climate metrics standard

Major concrete rebar producers Commercial Metals Co., Nucor Corp. and Steel Dynamics Inc. lead U.S. members of the Global Steel Climate Council (GSCC), recently chartered to support a standard that “accelerates the transition to low-emission steel and recognizes the potential of the recycled, circular steel model to reduce carbon emissions.” GSCC urges the United States and European Union, representatives of which are presently negotiating a new steel production emissions standard, to adopt a global solution incentivizing mill operators to use the cleanest process available.

Any agreement should focus on the amount of emissions generated, not on how steel is made, GSCC contends. The majority of the world’s steel production is extremely carbon intensive because it primarily relies on mined and processed coal, iron ore and limestone. However, other steelmakers—including those producing over 70 percent and 40 percent of respective U.S. and European manufactured steel—use electric arc furnaces (EAFs) that generate significantly lower carbon emissions than traditional blast furnace alternatives. 

“We have the technology to reduce carbon emissions in steel production by 70 percent today,” says Nucor CEO Leon Topalian. “The global industry needs to build on the innovation that has already led to cleaner steel production in the United States. The green and digital economies around the world are going to be built with steel, and the steel they are built with matters.”

High-emission steelmakers support a “sliding scale” U.S. and European Union standard that would set a greenhouse gas emission ceiling up to nine times higher for extractive versus recycled products, penalizing EAF producers and permitting higher-emission steel to be erroneously labeled as “green.” Under a sliding scale, GSCC notes, two steel products could be classified as equally “green,” even though one was produced by creating multiple times more carbon emissions than the other.

“Steel is essential for our economies, including the world’s essential infrastructure. This new standard will accelerate the actual reduction of greenhouse gas emissions and provide key decisionmakers with accurate data to make informed decisions,” adds Steel Dynamics CEO Mark Millett, who chairs another GSCC founding member, the Steel Manufacturers Association in Washington, D.C.

“We must prevent steel producers from classifying their products as green when the same products are available on the market with significantly lower carbon emissions,” said Francisco Cardona, head of Public Affairs at Celsa Group, a leading European producer of low-emission circular steel and also a founding Council member. 

The primary focus of the GSCC is to establish a standard guided by these principles:

  • Reducing GHG emissions from the global steel industry.
  • Establishing a standard that is technology/production method agnostic.
  • Establishing a standard that has a system boundary that includes Scope 1, 2 and 3 emissions.
  • Establishing a standard that aligns with a science-based glide path to achieve a 1.5 degree scenario by the year 2050.
  • Providing relevant information on sustainable steelmaking to appropriate decision-makers.

“The GSCC single standard will encourage all producers to reduce their carbon emissions and create a level playing field,” says Steel Manufacturers Association President Philip Bell. “U.S.-EU negotiations should not create a double standard and a slippery slope toward a dirtier environment. We can do better.”