China’s roadmap to green steel
Wenbo He, secretary of the Party Committee and executive chairman of the China Iron and Steel Association (CISA), spoke about China’s green steel plans at the integration conference of green steel, green energy and green finance industries on March 2
“Going green and decreasing one’s carbon footprint is not the responsibility of one enterprise or industry. I hope we can collaborate to create an ecosystem where green steel, green energy and green finance interact to achieve synergy,” Wenbo He said in his speech at the integration conference of green steel, green energy and green finance industries held in Jiayuguan City, Gansu Province on March 2.
I hope we can collaborate to create an ecosystem where green steel, green energy and green finance interact to achieve synergy.
In his speech, Wenbo He introduced four achievements that the steel industry had made concerning going green and reducing its carbon footprint:
- Member mills of CISA invested 37.14 billion yuan for energy conservation and environmental protection in 2022, up by 11.95% year on year.
- China has set up the environmental product declaration (EPD) platform for steel industry, which is the first EPD platform in China’s industrial sector. About 10 steel mills – including Baowu Steel and Shousteel – have released 35 EPD reports on the platform. Another six iron ore EPD reports were also launched.
- By 2022, 47 steel mills, with a total of 243 million tonnes of steel capacity, were recorded to have achieved whole-process ultra-low emissions.
- 21 steel mills – including Baowu Steel and Shousteel – have been earmarked to become benchmarks for energy efficiency in the next few years. The target is for 200-300 million tonnes of steel capacity to meet the efficiency benchmark by 2025.
The green, low-carbon transformation of the steel industry requires funding, and green finance is becoming vital in promoting the steel industry to reach its carbon peak and neutrality goals.
China’s green steel funding projects
Baowu Group and the National Green Development Fund established Baowu Carbon Neutral Equity Fund in 2021. The fund, with a total size of five billion yuan, is China’s biggest carbon-neutral fund.
Baosteel issued China’s first low-carbon transformation green bond with a size of 500 million yuan to invest in its hydrogen-based shaft furnace at Zhanjiang Iron & Steel.
Angang issued a mid-term green bond with a size of 300 million yuan to accelerate its carbon peak and neutrality goals. Wenbo He then pointed out three ways of achieving synergy between the steel and energy industries.
Aligning green steel production and energy industries
The steel industry provides the materials that the green energy industry needs. According to statistics from China’s National Energy Administration, 100 tonnes of steel is consumed to produce a one-megawatt wind turbine and 30 tonnes of steel is consumed to produce a one-megawatt photovoltaic module bracket. In 2022, around 3.76 million tonnes of steel were consumed in wind power installation, and around 2.62 million tonnes of steel were consumed in photovoltaic module brackets.
By 2050, China’s total capacity for photovoltaic power generation will reach 5,000 gigawatts, which equals approximately eight million tonnes of steel consumption per year. By 2060, China’s total capacity for wind power generation will reach 3,000 gigawatts, which equals approximately 22 million tonnes of steel consumption per year.
The steel industry spearheads projects that showcase green energy. Zhanjiang Iron & Steel completed a photovoltaic project with a total capacity of 46.89 gigawatts. Jiuquan Iron & Steel’s 2,400 gigawatts of wind and photovoltaic project is under construction.
Going green and decreasing carbon footprint is a long-term endeavor that links the steel and green energy industries. The new energy industry is promoting building integrated photovoltaics (BIPV), and steel structures are an integral part of this.
Tapping into green finance
Finally, Wenbo He encouraged the steel industry to connect with financial institutions to tap into green finance and promote low-carbon transformation. He noted that long-term financing mechanisms can be built to help key enterprises achieve low-carbon transformation and develop Carbon Capture, Utilization and Storage (CCUS), steel scrap recycling and electrolytic hydrogen projects.