The steel industry's generation of carbon dioxide (CO2) is mainly associated with the chemical reaction of carbon and iron ore in blast furnaces producing molten iron, which is then converted to steel. The carbon in blast furnaces is mainly used for such reduction, not for combustion, in the blast furnace.
Minimizing energy input has always been a major challenge for European steelmakers. A dramatic reduction of carbon input output has been achieved. The development has gone so far that theoretical limits according to the laws of physics are being approached. Further major reductions are becoming progressively difficult and uneconomic, because the marginal cost for further reductions is prohibitive.
Steel producers already use the most sophisticated energy and gas management systems for optimized use of energy in their processes. Gaseous by-products are used as fuels, replacing primary energy. Thermal energy in cooling water, waste gases, and residual products are recovered to a high degree.
A balance must often be found between conflicting environmental objectives. For example, reduction of dust emissions to meet new limit values by means of high-efficiency filters can also causes a higher energy demand. Efforts to recycle iron-containing residual products at steel mills in order to save raw materials and energy are increasingly thwarted by new waste legislation.
Vast resources have been spent on the development of steelmaking processes, and massive investments have been made in new plant and equipment. The result is that the existing processes today are operating close to the theoretical minimum as regards energy use. In the timeframe of the Kyoto Protocol, there is consequently no scope for significant CO2, emission reductions. Individual plants in some cases may be able to achieve some further reductions by fine-tuning their energy-management systems. Some reductions will also be achieved through a gradual shift towards more electric-arc furnace steelmaking.
Significant reductions for the steel industry as a whole may be possible only long-term (several decades), if completely new processes can be developed and successfully introduced. This would require large investments in research and development, pilot-plant testing, and finally scaling up to full-size plants. Presently, there are no new break-through processes on the horizon promising significantly lower CO2, emissions in steelmaking.
The limited impact of research and development to meet the Kyoto targets are confirmed in the European Commission's report “Economic Foundations for Energy Policy” (December 1999). This conclusion is especially valid for capital-intensive industries such as the steel industry.
The steel industry's main future contribution to reductions in CO2 emissions will be to use any remaining potential in the steelmaking process and to further develop the use of by-products and to work with its customers to help design better, longer lasting, more energy and material-efficient products. Recent development of high-strength steels has enabled customers to reduce the weight and improve the energy efficiency of products containing steel such as automobiles, packaging and civil engineering construction. The improvements in protective coatings for steel have increased the life of steel-containing products.
Steelmaking results in the production of valuable by-products. For example, slags are processed into building materials such as cement and aggregates providing a major contribution to the environment by reducing CO2 emissions and the need for new raw materials.