Energy-Intensive Industries: Decision making for a low-carbon future

The report analyzes the steel sector's transition to a low-carbon future, noting that while current carbon pricing (like the EU ETS) has had limited impact on plant location and investment, deeper emissions cuts will require breakthrough technologies such as carbon capture and storage (CCS). It emphasizes the need for collaborative research, development, demonstration, and deployment (RDD&D) and suggests a 'coalition of the willing' among major steel-producing nations to maintain competitiveness while decarbonizing.

• Global steel consumption is projected to roughly double by 2050, meaning that to keep greenhouse gas emissions at current levels, emissions per unit of steel must be halved.
• Current carbon pricing, specifically the EU Emissions Trading System (EU ETS), has not provided firm evidence of altering trends in steel production or investment location decisions, largely because allowances were often granted at levels close to actual emissions.
• Breakthrough technologies capable of significant emission reductions are not yet available for immediate widespread deployment, unlike the power or automotive sectors; however, carbon capture and storage (CCS) is likely to be essential for any technology that achieves deep reductions.
• The cost of implementing breakthrough technologies like CCS could be approximately $100/tCO2 or $200 per tonne of steel from a blast furnace, representing a 25% increase in standard production costs, which would significantly influence plant location decisions.
• Collaborative RDD&D programs, such as COURSE50 in Japan and ULCOS in Europe, are targeting breakthrough technologies, but current arrangements may not be fast enough to meet low-carbon economy needs without more scaled-up collaboration and clear funding plans.
• The report proposes a 'coalition of the willing' consisting of dominant producers—including China, Japan, the EU, Korea, and potentially Brazil and India—to mutually implement new technologies and carbon pricing to avoid losing market share to countries outside the agreement.
• Primary steelmaking via blast furnaces is highly capital-intensive, with new plants costing at least $2 billion for a typical 3 million tonne per year capacity, leading to long investment cycles of at least 25 years.
• The availability of scrap steel is a primary predictor of lower emissions per unit of steel, as electric arc furnaces (EAFs) emit approximately one-fifth of the CO2 compared to primary production routes.

APA

Wooders, P. (2012). Energy-Intensive Industries: Decision making for a low-carbon future. International Institute for Sustainable Development. https://www.iisd.org/system/files/publications/tricc_energy_intensive_industries_steel.pdf

Chicago

Wooders, Peter. Energy-Intensive Industries: Decision making for a low-carbon future. International Institute for Sustainable Development, 2012. https://www.iisd.org/system/files/publications/tricc_energy_intensive_industries_steel.pdf.

Wikipedia

{{cite report |last1=Wooders |first1=Peter |title=Energy-Intensive Industries: Decision making for a low-carbon future |publisher=International Institute for Sustainable Development |date=November 2012 |url=https://www.iisd.org/system/files/publications/tricc_energy_intensive_industries_steel.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{wooders2012energyintensive, author = {Wooders, Peter}, title = {{Energy-Intensive Industries: Decision making for a low-carbon future}}, institution = {International Institute for Sustainable Development}, year = {2012}, month = nov, url = {https://www.iisd.org/system/files/publications/tricc_energy_intensive_industries_steel.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }