Bill Hare is CEO and senior scientist with Climate Analytics.

The term “hard-to-abate” is widely claimed by heavy industry like the iron and steel sector to argue against having to reduce emissions quickly, or to justify their continued faith in carbon capture utilisation and storage (CCUS) – or offsets – to meet climate goals.

But continuing to classify highly polluting industrial sectors as “hard-to-abate” is jeopardising the world’s ability to achieve global net-zero CO2 emissions by around mid-century, critical to the Paris Agreement goal of limiting warming to 1.5C.

In a recent report, we have taken a forensic look at the iron and steel (and cement) sectors, showing how the “hard-to-abate” label has shaped both policy and industrial actions in ways that risk undermining the urgency and effectiveness of global climate mitigation efforts.

The iron and steel sector accounts for 7-8% of global greenhouse gas emissions. Technologies for achieving zero emissions in steel production are currently available at commercial scale, with strong policy support.  

Colombia announces fossil fuel phase-out summit to be held in 2026

Yet this sector has convinced governments that it cannot mitigate its emissions without CCS – as evidenced by the recent German government announcement that sets aside €6 billion ($7 billion) to deal with hard-to-abate sectors like steel, which includes inviting proposals for CCS projects.

Iron and steel emissions are currently projected to be just 10% lower in 2050. Yet, in top-down scenarios that limit warming to 1.5C – such as the International Energy Agency’s Net Zero Emissions roadmap – combined CO2 emissions for iron and steel fall by about 23% by 2030 below 2023 levels, 46% by 2035 and 94% by 2050.

Existing tech and demand reduction can cut emissions

Steel is produced by one of three different methods. Nearly three-quarters of the world’s steel is still produced with the highly polluting “blast furnace to basic oxygen furnace” (BF-BOF). Here, coal is turned into coke at high temperatures to provide the carbon monoxide required to turn iron ore into iron. Coal typically also powers the furnace, where the steelmaking occurs. All stages of this process produce CO2.

The second is “direct reduced iron to electric arc furnace” (DRI-EAF) where iron ore is reduced in a direct reduction furnace in a solid state using a reduction gas such as hydrogen or syngas (often derived from fossil fuels). As the name implies, electric arc furnaces are powered by electricity, so there’s a choice of electricity generation sources.

Lastly, there’s scrap steel recycling in Electric Arc Furnaces (EAF), which can also be entirely powered by renewables.

This sector, we find, could feasibly reach near-zero residual CO2 emissions by around 2050 based on currently available technologies. If complemented by strong demand-side interventions without large-scale CCUS, this sector could potentially eliminate the need for negative CO2 emissions.

Carbon colonialism? Malaysia and Indonesia plan storage hubs for Asian emissions 

Demand reduction measures, such as increased use of secondary steel and improving material efficiency, could reduce steel requirements by up to 20% by 2050, making deep decarbonisation even more achievable. Substantial emissions reductions could be achieved through circular economy strategies that reduce steel demand, such as cutting the ‘overspecification’ of steel in construction, which could lower steel use by 35–45%.

Advanced retrofitting of existing plants could also help limit warming to 1.5C. Substitution of green hydrogen and, only where necessary, CCUS, could lead to large reductions of up to 66% of cumulative emissions from this sector between 2020-2050, compared to estimated emissions levels without any interventions.

CCUS not working for industry

Industry recourse to future CCUS deployment and offsets must also be put in the context of doubts about the legitimate mitigation potential of these pathways. Because despite its frequent promotion, CCUS deployment in supposed hard-to-abate sectors – or indeed any sector – remains minimal for emissions abatement purposes.

Reliance on CCUS poses substantial technical, economic and scalability risks. It cannot capture 100% of emissions; residual emissions are inevitable.

The combined announced capacity for CCUS projects that are operating, planned or under construction in the steel sector is only 9 million tonnes of CO2 a year. This is just 0.3% of the total 2.6 billion tonnes of CO2 the steel sector emitted in 2022.

There are only two operational CCUS projects in the global iron and steel sector, which are delivering minimal capture rates. Aside from these, there are only 11 planned projects and one (two-stage) project under construction. This is compared to the more than 1,000 steel plants operating or under development globally.

Offsets, by design, allow CO2 emissions to occur that would not otherwise have occurred in their absence and often lack additionality, permanence and verifiability, thus failing to deliver real mitigation.

Together, CCUS and offsets allow companies to delay investment in transformative solutions. Strong policy and regulation should instead consider treating sectors like iron and steel as typical sectors with 1.5C-compatible emissions reduction obligations, reducing dependence on negative emissions by mid-century.

The post Is “hard-to-abate” really that hard – or is it a justification for delay? appeared first on Climate Home News.

Is “hard-to-abate” really that hard – or is it a justification for delay?