Low Carbon Technologies for the Global Steel Transformation
The steel sector’s transformation is speeding up: COP28 saw pledges to procure low-CO2 steel, fresh steps to harmonise measuring the sector’s greenhouse gas emissions and the launch of the Climate Club, aimed at fostering international cooperation to accelerate industrial decarbonisation.
These are encouraging signals for a sector that is responsible for 8 percent of global CO2 emissions and has long been labelled as hard to abate. While the current primary steelmaking route is hugely CO2 intensive and coal dependent, our study shows that near-zero CO2 technologies, in particular those based on the direct reduction of iron, can be deployed this decade, offering flexible pathways and new business cases for economies at different stages of industrial transformation.
However, these key low-carbon technologies are often more expensive than current production methods. This is especially the case in the early stages of the transition. Targeted support and increased international cooperation are needed to build on the current momentum and enable an accelerated transformation of the global steel sector. In this study, we assess eight potential low-CO2 steelmaking technologies, analysing key parameters such as their market readiness, cost and CO2 emission reduction potential to determine the role they can play in the steel sector’s transformation.
