Apr 2023
Iron & steel
Driven by population and GDP growth, global demand for steel has been growing strongly in recent years and is expected to continue to increase, especially because of economic expansion in India, ASEAN countries and Africa, even as demand in China gradually declines.
Read more
The steel sector is currently highly reliant on coal, which is primarily used to as a reducing agent to extract iron from iron ore and to provide the carbon content needed in steel.
While the energy intensity of steel has gradually fallen in the past decade, expanding production has generally raised total energy demand and CO2 emissions. Short-term CO2 emissions reductions could come largely from energy efficiency improvements and increased scrap collection, which would enable more scrap-based electric arc furnace production (considerably less energy-intensive than primary production).
Even with higher recycling rates, scrap availability will put an upper limit on the potential for recycled production. Adopting material efficiency strategies to reduces losses and optimise use across value chains can curb demand growth and thus help in reducing CO2 emissions from the steel manufacturing. Material efficiency strategies include increasing steel and product manufacturing yields, lightweighting vehicles, extending building lifetimes and directly reusing steel (without melting).
Longer-term emissions reductions would require a step change in the way primary steel is produced through the adoption of new direct reduced iron and smelt reduction technologies that facilitate the integration of low-carbon electricity (directly or through electrolytic hydrogen) and CCUS.
While the energy intensity of steel has gradually fallen in the past decade, expanding production has generally raised total energy demand and CO2 emissions. Short-term CO2 emissions reductions could come largely from energy efficiency improvements and increased scrap collection, which would enable more scrap-based electric arc furnace production (considerably less energy-intensive than primary production).
Even with higher recycling rates, scrap availability will put an upper limit on the potential for recycled production. Adopting material efficiency strategies to reduces losses and optimise use across value chains can curb demand growth and thus help in reducing CO2 emissions from the steel manufacturing. Material efficiency strategies include increasing steel and product manufacturing yields, lightweighting vehicles, extending building lifetimes and directly reusing steel (without melting).
Longer-term emissions reductions would require a step change in the way primary steel is produced through the adoption of new direct reduced iron and smelt reduction technologies that facilitate the integration of low-carbon electricity (directly or through electrolytic hydrogen) and CCUS.
Last updated Sep 27, 2022
Key findings
Global steel production in the Net Zero Scenario, 2010-2030
OpenInnovation will be crucial to decarbonise steel production
The direct CO2 intensity of crude steel production has decreased slightly in the past few years, but efforts need to be accelerated to get on track with the pathway in the Net Zero Emissions by 2050 Scenario. In contrast to the minor annual improvements in the last decade, the CO2 intensity in the Net Zero Scenario falls by around 3% annually on average between 2020 and 2030.
The current pipeline of projects clearly nonetheless falls short of what is required to meet the Net Zero Scenario. Governments can help by providing RD&D funding, creating a market for near zero-emission steel, adopting policies for mandatory CO2 emission reductions, expanding international co‑operation and developing supporting infrastructure
The current pipeline of projects clearly nonetheless falls short of what is required to meet the Net Zero Scenario. Governments can help by providing RD&D funding, creating a market for near zero-emission steel, adopting policies for mandatory CO2 emission reductions, expanding international co‑operation and developing supporting infrastructure
Explore more data
Analysis
-
Emissions Measurement and Data Collection for a Net Zero Steel Industry
-
Energy Technology Perspectives 2023
-
Climate Resilience for Energy Security
-
Building Envelopes
Technology deep dive
Not on track
-
Industry
Sectoral overview
Not on track
-
Iron and Steel
Subsector
Not on track
-
Driving Energy Efficiency in Heavy Industries
Global energy efficiency benchmarking in cement, iron & steel
-
A policy framework for accelerating sustainable energy transitions in heavy industry
Commentary — 21 December 2020
Our work on Iron & steel
The IETS TCP focuses on energy use in a broad range of industry sectors with significant potential for emissions and cost savings. The IETS TCP work programme ranges from aspects relating to development of processes and energy technologies, to overall system analysis and energy efficiency in industry sectors.
Related sectoral Technology Collaboration Programmes (TCP)
Events
May 2022
IEA Contributions to the G7 in 2022
14 Dec 2020 14:00—16:00
