Posts Tagged ‘Washington’

China’s Hunan province bans coke industry expansions

This is one of a number of signs that China is becoming serious about the environment in general and the impact of pollutants from the iron and steel industry in particular. Clearly, the Beijing and provincial governments have a long way to go, but then so does the US industry and many others. Globally at present, the use of coke as a reductant/energy source means that the only real alternatives are DRI and EAFs. There is some use of charcoal – but many mills could significantly improve their efficiencies, as was discussed at SBB’s recent Green Steel Summit in Washington.

SBB 30 July 2010 Hunan province, China’s fourth largest coke-producing province, is banning any expansions in its coke industry over the next three years, Steel Business Briefing learns from a provincial government anouncement.

The Hunan Environmental Protection Department issued the notice on 22 July, saying there will not be any environment assessments done on any coke expansion projects for the next three years.

However, there are still some projects which are excluded from the ban, if they are included in the province’s coke industry development plan, but the provincial government tells SBB the plan is still under discussion.

These projects also need to have a minimum annual production of 100,000 tonnes and meet a series of environmental protection requirements such as installing a coke quenching water circulatory system and a process gas desulfurization system.

But small coke producers in Hunan have quite a cold response to this new policy, as they lack confidence in the market at the moment. “We have talked about cutting our production recently because of the currently poor sales. So this new policy won’t have any immediate influence,” an officer with a Hunan-based coke producer tells SBB.

Hunan province produced 21m tonnes coke in 2009, accounting for 6% of China’s total production. In January-June this year, Hunan produced 10m t of coke.


Spanish mills criticise slow CO2 action in USA

Spanish steel producers here criticise the US for taking only feeble action to reduce CO2 emissions from its steel operations, whilst the EU Commission has been significantly more active. There is some validity in the Spanish criticism: the USA, as well as many other countries, are very slow in taking action. The US government should be encouraging the EPA to move ahead.

SBB 7 July 2010 The Spanish steelmakers’ association Unesid is to ask the EU to suspend the adoption of new environmental rules affecting the industry,Steel Business Briefing learns from the association’s annual meeting in Madrid.

Costs are perhaps the most important factor in determining the success of players in the international steel market, and Unesid warns that the competitiveness of European producers could be undermined by any unilateral decisions, as European players compete with third country steel companies who do not have to meet similar regulations.

Spanish steelmakers are concerned, in particular, about the increasing number of regulations and plans for an emission trading system, which are considered “an important burden” for producers.

“Environmental issues are an important part of Unesid’s activities, but we face too many regulations which our international competitors do not have to meet,” Gonzalo Urquijo, president of Unesid, told the meeting.

According to Urquijo, the EU has committed to reduce its polluting emissions by 20% by 2020, while other commercial competitors, like the US, have only expressed an “intention” to limit such emissions by less than 5%.

Iron and Steel Generates 5% of World CO2

The iron and steel industry is responsible for at least 5% of global energy-related carbon dioxide emissions. Though inter-governmental talks on setting specific emission targets for future years seem to be going nowhere, most governments agree that much needs to be done to reduce such discharges. The steel industry stands to gain as well as lose from such developments. For further information please click here

 The SBB Green Steel Summit will examine the various ways that the steel industry’s emissions are being viewed and highlight the ways in which steel producers and consumers, as well as industry suppliers and analysts, need to prepare themselves for the likely changes.

The recent failure of the Copenhagen talks to identify a clear follow-up to the Kyoto Protocol has removed some of the earlier impetus for governments and companies to take action on sustainability. SBB believes that this hiatus provides an opportunity for the steel industry to examine its priorities at an independently-hosted meeting.

Many in the industry believe that a full life cycle analysis of the industry’s finished production shows that its CO2 footprint is not as substantial as it might first appear. The widespread reuse of steel in electric arc furnaces, as well as in the converter in integrated producers is clearly a key factor in this view.

In contrast, many governments and pressure groups take a narrower approach. On the one hand, they believe that steel should broadly be subject to the same rules as other manufacturing industries. On the other hand, they also generally accept that stringent controls of emissions would place their steel sectors seriously at risk from carbon leakage (which would involve a shift in steel-making to countries with less rigorous CO2 regulations). The extent of any leakage will depend though, on the price of carbon allowances; currently it is relatively low.

Carbon leakage is of most concern in Europe and North America. At present, it is unclear if the USA will adopt cap and trade legislation as in Europe. However in the long term, carbon emission regulations, whether they be through carbon taxes, direct emission limits or a market based mechanism (such as cap and trade) are expected to reshape the industry. Most expect to see steel-making move to countries such as India, Brazil and Russia.

To counter this, many in the steel industry in North America and the European Union are urging governments to tax steel imports from countries that have lax or no emissions’ legislation. The SBB Green Steel summit will examine these moves and to what extent they are consistent with WTO rules.

Meanwhile in Europe, negotiations are currently focussing on some form of plant-based benchmarking to operate alongside the cap and trade legislation.  This would give free allowances to only a handful of the most efficient steel makers. Others could face harsh cost penalties.

At the same time, many steel consumers, particularly in the car and construction industries are increasingly looking to buy steel manufactured through sustainable routes. This is likely to give an edge to EAF producers, which emit far lower levels of CO2/tonne of steel. But in the future, if insufficient scrap is available in appropriate qualities, then EAF producers may also want to switch to DRI/HBI and or pig iron. The SBB Summit will look at these possibilities, and their availability.

Other industrial sectors such as power generation are also facing the need to buy carbon emission allowances; to mitigate this they are already looking to buy steel of higher grades and in larger volumes. Wind turbines, for example, are quite steel intensive. Car manufacturers too want lighter but tougher steels for new hybrid vehicles to emit less CO2.

At the end of the day, steel makers may be forced to invest in new technologies. The blast furnace route necessarily involves the emission of CO2 from its use of coke. New technologies require R&D, and steel makers are looking for government support for this. Most of the so-called “breakthrough” technologies now under discussion involve the use of Carbon Capture and Storage (CCS). The SBB Washington Summit will examine these proposed technologies and their likely positive and negative impact on the steel industry.

By Roger Manser