Civil society organizations have published an open letter calling on policymakers, steelmakers, and buyers to disregard a recent “standard” released by the Global Steel Climate Council.

The organizations argue that this standard, which was created to influence trade agreements, including a pending deal between the United States and European Union, favours the existing practices of a small fraction of steelmakers in wealthy nations rather than creates mechanisms to meaningfully decarbonize global steelmaking, and should be ignored in any government standards or trade agreements.

Philip K. Bell, president of the Washington-based Steel Manufacturers Association, a founding member of the Global Steel Climate Council, said the GSCC Steel Climate Standard is designed to decarbonize global steelmaking by allowing customers to choose steel that has the lowest carbon emissions. “Other dual-standard regimes for steel emissions provide an environmental fig leaf for companies that make steel with coal-intensive, high-carbon-emissions blast furnaces yet still want to call their products clean or green or responsible,” Bell said. “The GSCC Steel Climate Standard is a process-agnostic, verifiable, reliable way of determining whether a steel product is consistent or with carbon-reduction goals.”

“When you allow a collection of industry members more interested in positioning themselves as the green alternative rather than meaningfully and decisively reducing emissions, you end up with a standard like the one created by the GSCC."

Margaret Hansbrough, Campaign Lead for Steelwatch

Margaret Hansbrough, Campaign Lead for Steelwatch, commented: “When you allow a collection of industry members more interested in positioning themselves as the green alternative rather than meaningfully and decisively reducing emissions, you end up with a standard like the one created by the GSCC. When it comes to reducing emissions from the global steel industry, we simply cannot recycle our way out of the problem. Any global climate standard for steel must create effective mechanisms that incentivize primary producers to transition off of coal and toward proven solutions.”

According to the SMA's Bell, the GSCC Steel Climate Standard gives steelmakers every incentive to switch from high-emissions coal to a proven solution such as electric arc furnace (EAF) steelmaking. “Ms. Hansbrough took a rather different view of recycling earlier this year,” he said, “when she insisted that the way Japan’s steel industry could meaningfully reduce carbon emissions was to switch to scrap-based EAF steelmaking,”

The steel industry is responsible for 7% of global greenhouse gas emissions. Climate groups, however, argue that the GSCC standard fails to meaningfully reduce emissions from global steelmaking by not taking into account the differences between steel made from recycled scrap and primary steelmaking made from iron ore.

That’s wrong, according to Bell. “The GSCC standard is in line with the climate budget, is built on sound and conservative principles, and ensures the 1.5°C objective,” Bell said. “On the contrary, the alternative standards, by using a sliding scale, allow blast-furnace steelmakers to call themselves green or clean or responsible while sticking with coal. The rationale behind them explains why more blast furnaces are being built or relined now and even more are being planned. The GSCC standard is the only one that adheres to the IEA pathway and creates a meaningful reduction in carbon emissions.”

Coal-based production makes up 70% of global steelmaking and 90% of the sector’s emissions.

According to the letter writers, the global recycling rate of scrap is already at 85% and the Mission Possible Partnership has concluded that “even in a more circular economy, over one billion tonnes per annum of primary steel (using iron ore feedstock as opposed to scrap) will be needed globally by 2050.”

Bell said there is more than enough ferrous scrap to support a global shift to EAF steelmaking, citing a 2023 study that offers the most accurate calculation of scrap availability to date. “You will notice how companies in Germany, Canada and other countries are shifting from integrated production to EAF/DRI, a signal that they believe there will be sufficient scrap,” Bell said. “And integrated steelmakers in the United States have told their investors that there is plenty of scrap to support growth in EAF production.”

The signers of the open letter insist that the GSCC standard also confuses the market while failing to address the social and environmental impact of steelmaking. As automakers, renewable energy developers, and other industries seek to reduce their supply chain emissions, a global certification for low-emissions and sustainably-produced steel is more important than ever.

“The groups behind the letter apparently want to tell automakers, construction companies, and appliance manufacturers that all kinds of steelmaking are clean, even the coal-intensive one that produces significantly more carbon dioxide emissions. That approach is the real cause of confusion in the marketplace,” Bell said.

According to the civil society groups, the industry-created GSCC fails to provide this standard while competing with already-established rules created through a multiple-stakeholder process, including ResponsibleSteel and the Science Based Targets Initiative.

The GSCC standard also solely focuses on emissions, its critics charge, ignoring other environmental and social impacts of the industry, including environmental degradation and harm to local communities from mining coal and iron, deforestation, violations of labour and human rights, air pollution from the deconstruction and recycling of steel into scrap, or air pollution from steel mills themselves.

"Steel that meets the GSCC Steel Climate Standard leads to lower carbon emissions, cleaner air, healthier forests, more liveable communities, better conditions for workers, and less scrap in landfills and rivers and lakes.”

Philip Bell, President of Washington-based Steel Manufacturers Association and founding member of the Global Steel Climate Council

“In fact, steel that meets the GSCC Steel Climate Standard leads to lower carbon emissions, cleaner air, healthier forests, more liveable communities, better conditions for workers, and less scrap in landfills and rivers and lakes,” Bell said. “Integrated steelmakers that embrace dual standards, on the other hand, call their steel clean even though their production methods cause the harms these groups claim they want to eliminate.”

But Matthew Groch, Senior Director of Decarbonization for Mighty Earth said: "We urge steel buyers to avoid GSCC-certified steel as it fails to reduce emissions and puts staying within 1.5C of global warming at risk. At at time when automakers are looking to decarbonize their whole supply chains, the last thing they need is yet another steel certification standard that offers nothing more than confusion and greenwash with weak standards which threaten to worsen the environmental impacts of the steel industry."

Bell, however, pointed out that the Steel Climate Standard lets no one off the hook. “The standard makes clear that every steelmaker, no matter how low its carbon emissions are today, must continue cutting emissions to ensure that the steel industry hits its target by 2050,” he said.

“We have an opportunity to decarbonize entire supply chains, investing in technologies at scale that can slash global emissions and forge a clean energy future built with clean steel,” concluded Johanna Lehne, programme lead for E3G. “Individuals across the steel industry must put all their efforts into building a legitimate global standard that prioritizes cleaner air and water, human rights and workers’ rights, and moving the market forward to produce truly low-emissions steel.”

“Customers have a right to know whether the steel they buy is the cleanest steel available,” Bell said. “The GSCC Steel Climate Standard tells them what they need to know.”