Pedal to the Metal 2026

The global iron and steel industry faces a 'coal lock-in crisis' as blast furnace (BF) capacity continues to expand despite decarbonization targets. While electric arc furnace (EAF) and direct reduced iron (DRI) capacities are growing, the transition is slowed by massive legacy assets in China and aggressive new coal-based developments in India. Green hydrogen remains a critical but underutilized bottleneck, with only 2% of operating DRI capacity using it as a primary reductant. The report highlights a significant gap between announced net-zero goals and actual industrial investment, particularly regarding the relining of existing blast furnaces.

• Global blast furnace (BF) capacity is projected to increase despite decarbonization goals, with 319 mtpa under development. Net additions are projected at 73 mtpa by 2030 and 88 mtpa by 2035.
• Electric arc furnace (EAF) capacity is increasing its share of the global operating fleet, rising from 31% in 2022 to 34% (727 mtpa) in 2026. EAFs now represent 50% of all developing steel capacity.
• India is the primary driver of new coal-based capacity, developing over 60% of upcoming BF-BOF capacity globally. Approximately 93% of India's developing ironmaking capacity will use coal-based technology, though only 5% has broken ground.
• China's transition is constrained by its massive legacy fleet; 94% of its blast furnace capacity has no retirement plan. While China's EAF share of developing capacity (39%) is higher than its existing share (17%), the overall impact is limited by the scale of its operating fleet.
• Direct reduced iron (DRI) capacity is expanding rapidly and could grow by 141% if all developments proceed, reaching 296 mtpa by 2035. However, 83% of operating DRIs with known reductants still use gas and 17% use coal.
• Green hydrogen is a major bottleneck for decarbonization; only 2% (4 mtpa) of operating DRI capacity uses green hydrogen as a primary reductant, although 19% of planned capacity with a known reductant intends to use hydrogen upon startup.
• The relining of existing blast furnaces is a significant 'lock-in' signal, with 80 mtpa of capacity having planned or ongoing relining, indicating an intention to operate these coal-based units long-term.
• Induction furnaces (IFs) may have higher emissions profiles than EAFs because they rely more heavily on sponge iron from coal-based rotary kilns; IF production uses 73% sponge iron compared to 21% for EAFs.
• The United States has the world's oldest blast furnace fleet, with an average age of 80 years in 2026. Recent policy shifts under the Trump administration have led to the cancellation of hydrogen-based modernization projects, such as those by Cleveland-Cliffs.

APA

Grigsby-Schulte, A., Liu, F., Swalec, C., Almada, R., Cleland, L., Dalisay, C., Zhang, Z., & Zhi, J. (2026). Pedal to the Metal 2026. Global Energy Monitor. https://globalenergymonitor.org/sites/default/files/2026-05/Pedal%20to%20the%20Metal%202026.pdf

Chicago

Grigsby-Schulte, Astrid, Fanwei Liu, Caitlin Swalec, Rolando Almada, Larkin Cleland, Charmaine Dalisay, Ziwei Zhang, and Jessie Zhi. Pedal to the Metal 2026. Global Energy Monitor, 2026. https://globalenergymonitor.org/sites/default/files/2026-05/Pedal%20to%20the%20Metal%202026.pdf.

Wikipedia

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BibTeX

@techreport{grigsbyschulte2026pedal, author = {Grigsby-Schulte, Astrid and Liu, Fanwei and Swalec, Caitlin and Almada, Rolando and Cleland, Larkin and Dalisay, Charmaine and Zhang, Ziwei and Zhi, Jessie}, title = {{Pedal to the Metal 2026}}, institution = {Global Energy Monitor}, year = {2026}, month = may, url = {https://globalenergymonitor.org/sites/default/files/2026-05/Pedal%20to%20the%20Metal%202026.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }