Green Future for Steel Within Reach

“Practical policy and industry action” across the UK, Spain, France and the US will help secure a viable investment case for near zero emissions primary steel projects, said the Energy Transitions Commission (ETC). The ETC’s new report noted that the existing global pipeline for low-carbon steel projects must triple within the next three years, reaching 190 million tonnes a year of ‘green’ production by 2030 to keep the industry’s emission reduction targets within sight. Each of the four identified countries “can offer a viable investment case, particularly in light of recent policy developments”, the ETC said. Major policy developments highlighted in the report include the low-carbon hydrogen production tax credit under the US Inflation Reduction Act (IRA) and the EU’s Carbon Border Adjustment Mechanism (CBAM). Further action from these governments to support capital expenditure and forward purchase agreements at an initial premium will further close the financial gap for projects across all four countries in the near-term, the report added. Co-operation between governments and companies is also essential to ensure efforts to upscale green steel production don’t cause cross-border friction. The ETC has recommended coordinated aggregation of public and private sector demand across borders to strengthen purchasing signals for near zero emissions iron and steel products, as well as increased harmonisation across product standards, definitions and certification systems. Julia Reinaud, Senior Director, Europe, at Breakthrough Energy, said: “This report clearly demonstrates that the UK, Spain, France and the US are viable locations for breakthrough iron and steelmaking projects. Ensuring stable and affordable electricity prices for industry and collaboration across the entire value chain are essential for making these projects happen in the short term, and critical for the action that is urgently needed this decade.” 

 

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