Deep Decarbonization Roadmap for China’s Steel Industry

Iron and steel manufacturing is one of the most energy-intensive industries worldwide. The iron and steel industry accounts for around 7% of global greenhouse gas (GHG) emissions and 11% of global carbon dioxide (CO2) emissions. In 2021, China accounted for 53% of global steel production. The Chinese steel industry produced 1,033 million tonne (Mt) of crude steel in 2021, of which 89.4% was produced by primary steelmaking plants using blast furnace-basic oxygen furnace (BF-BOF) and 10.6% was produced by the electric arc furnace (EAF) production route.

China pledged to peak its CO2 emissions before 2030 and achieve carbon neutrality before 2060. China’s steel industry is expected to peak its CO2 emissions before 2030. This peak in steel industry CO2 emissions is mainly driven by the peaking of domestic steel demand. Steel production in China has one of the highest carbon intensities in the world because the majority of the steel is produced by energy-and carbon-intensive BF-BOF steelmaking process.

Global Efficiency Intelligence in collaboration with the Lawrence Berkeley National Laboratory is conducting a study to develop a roadmap for deep decarbonization of the Chinese steel industry. In this study, we analyze the current status of the Chinese steel industry and develop scenarios up to 2050 to analyze different decarbonization pathways that can help substantially reduce the CO2 emissions of the steel industry in China. We include five major decarbonization pillars in our analysis, which are: 1) demand reduction, 2) energy efficiency, 3) fuel switching, electrification, and grid decarbonization, 4) technology shift to low-carbon steelmaking, 5) carbon capture, utilization, and storage (CCUS).