Coal-based steelmaking capacity under development globally that follows the ‘blast furnace-basic oxygen furnace’ production method increased to 380Mt/yr in 2022 from 350Mt/yr in 2021, at a time when its share of the world’s total capacity must shrink dramatically in order to hit long-term decarbonization targets.
These are the findings of a new annual report from Global Energy Monitor.
The annual survey of data in the Global Steel Plant Tracker finds that almost all of the coal-based capacity under development is in Asia (99%), with China and India holding the majority of those developments (79% together).
For the first time ever, India has surpassed China as the top developer of coal-based capacity: it holds 40% of coal-based ‘blast furnace-basic oxygen furnace’ capacity under development, while China is responsible for 39%.
But while coal-based steelmaking has in recent years ceded part of its share to cleaner forms of production, the transition is moving far too slowly.
The transition away from coal-based steelmaking is underway but moving far too slowly."
Caitlin Swalec, programme director for heavy industry at Global Energy Monitor.
According to the International Energy Agency’s Net-zero by 2050 scenario, the total share of ‘electric arc furnace’ capacity should reach 53% by 2050. This means 347 metric tonnes (Mt) of coal-based capacity would need to be retired or canceled and 610Mt of electric arc furnace capacity would need to be added to the current fleet.
Caitlin Swalec, programme director for heavy industry at Global Energy Monitor, commented, “Steel producers and consumers need to raise ambition for decarbonization plans. The transition away from coal-based steelmaking is underway but moving far too slowly. Developers that add coal-based capacity now run the risk of facing billions in write downs in the future.”