Tracking the steelmaker transformation
The steel sector is a major driver of climate change, and while many companies talk up plans to cut carbon emissions, tracking decarbonisation and other crucial actions is difficult, as key data remains elusive and underreported.
This not only makes it difficult to see who is acting in good faith, and who is greenwashing, it also makes real progress difficult to assess, as tracking CO2 emissions and emissions intensity only tells us part of the story.
CO2 emissions reporting is often incomplete for example, while emissions intensity lacks key elements, such as proper Scope 3 emissions data. Methane emissions from coal mining are left out, as are emissions from joint ventures, and emissions can go down for a company because it sells a plant, but that doesn’t mean the emissions stop.
SteelWatch’s new data tool, the Steelmaker Transformation Tracker, helps separate decarbonisation spin from real actions, supporting more accurate analysis of how 22 steelmakers headquartered in countries including Brazil, China, Germany, India, Iran, Japan, Luxembourg, Russia, South Korea, Sweden, Türkiye and the USA are performing on their climate and social commitments.
Using information mainly from company reporting, supplemented by Global Energy Monitor (GEM) and other public data, the tracker monitors 23 indicators across company emissions, decarbonisation commitments, dependency on coal, the shift to green steel, and impacts on people and society. These are the critical metrics to pay attention to, and what they’re showing us is that while there are some encouraging developments, most of these companies are barely making any tangible progress.
Coal remains the single largest problem. Both emissions and the number of coal-based blast furnaces continue to rise, and considering the majority of companies in this tracker don’t even report their coal consumption, real consumption is likely to be significantly higher.
The dominant narrative is that the sector is “hard to abate”, and while it is true that transforming steel production is a challenge, it’s one that the world’s steelmakers need to take seriously for us all to have a stable climate and stable economies in the future.
Other tools that tend to focus at the level of a plant, or a specific steel product. RThis one focuses on the entire company: tracking what tangible actions the corporates are actually taking, such as eliminating coal consumption by retiring blast furnaces, and expanding use of green iron.
Transforming steel production to be near-zero emissions is a long term process, but a lot needs to happen in the short term to ensure companies are on the right path. Right now, we need commitments from steelmakers to source green iron and to not expand fossil fuel-based production. This tool will keep a close eye on who is delivering.
Steel production is a major driver of the worsening climate crisis, but it is ironic that the largest challenge steelmakers face – transforming production to be near-zero emissions – is one so badly tracked. Data is buried, boundaries and methodologies inconsistent, scrap use is not publicly reported. It’s virtually impossible to compare many data points across steelmakers in a meaningful way.
This is our starting point, and we hope that this tool provides a means in which to cut through the spin, hold steelmakers to account, and ensure they live up to their responsibilities on decarbonisation, and improving health and safety outcomes for workers and communities. warnings that CBAM must be ‘improved’ — leaving implicit the idea of what must stop if it does satisfy them.
