As more mills switch to less-polluting electric arc furnaces (EAF), carbon dioxide emissions from the world’s steel sector are expected to drop 30% by 2050 compared to last year, according to a study released on Tuesday by consultancy Wood Mackenzie.
The report highlighted that almost 48% of worldwide crude steel will be produced using EAF by 2050, up from 30% in 2021 and nearly on par with traditional blast furnace steelmaking.
The global share of EAF in steelmaking is rising amid policy shifts and increasing focus on scrap use, said Malan Wu, research director at Wood Mackenzie, adding that basic oxygen furnace (BOF) output is likely to decline 0.5% annually until 2050, whereas EAF output could increase 2.3% yearly.
According to the consultancy, the steel industry generated more than 3.3 billion tonnes of greenhouse gases last year, with China contributing more than 2 billion tonnes.
However, the company expects China to halve its carbon emissions over the next three decades, with reduced steel output accounting for the majority of the reduction.
In order to achieve its carbon pledges, China reduced crude steel output by 30 million tonnes in 2021 compared to the previous year and has vowed another annual decrease this year.
On the other hands, mills in mature economies, such as Japan, South Korea, the European Union, and the United States, will bear a greater burden since they must reduce emissions by nearly half while maintaining output at current levels.
According to the consultancy, the sector will begin using hydrogen as early as 2027, with the European Union leading the way. Hydrogen-based steel production is expected to account for 10% of the global total output by 2050.
Yet, steel emissions in India and Southeast Asia are expected to double when output triples, but primarily using traditional, more polluting technologies, said Wood Mackenzie.