Decarbonizing the Steel Industry: Assessing Trends, Technologies, Challenges and Case Studies

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The steel industry is responsible for approximately 8% of global CO₂ emissions and is considered a hard-to-abate industry due to its reliance on coal to meet energy and feedstock demands in primary production.
In addition, according to the World Economic Forum, steel demand is projected to rise 30% by 2050 and will be bolstered by the roll-out of energy transition technologies such as wind power.
As a result, decarbonizing the steel industry has become crucial for achieving net-zero goals.

This report assesses the suitability of energy transition technologies such as secondary stream manufacturing, electrification, hydrogen, and CCUS, all of which hold significant decarbonization potential for steel. Additionally, this report also presents an overview of emissions performance, as well as both interim climate and net-zero targets from a selection of steel producers. This provides an outlook on industry progress towards decarbonization.

Many energy transition technologies are still emerging and remain expensive. This is particularly challenging in the steel industry as it is inherently capital-intensive. As a result, steel producers may be more hesitant to adopt unproven technologies due to associated financial risks.

H2 Direct Reduction of Iron (H2DRI) and electric arc furnaces (EAFs) are currently the most promising routes for emission reduction from the steel industry. However, both methods face several challenges that hinder their widespread adoption. For H2-DRI, its dependence on cost competitive green hydrogen will be a major limiting factor for the immediacy of its decarbonization impact. For EAFs, the availability of scrap steel poses a big challenge. The global recycling rate is estimated to be around 85%, with limited room for improvement.

Scope

Overview of steel emissions, global steel production, and what the net-zero scenario for steel looks like.

Net-zero targets for selected steel companies

Analysis of steel companies’ interim emission targets

Steel companies’ Scope 1 and 2 emissions data

Analysis of different decarbonization technologies (secondary stream manufacturing, electrification, hydrogen, and CCUS), including an assessment of their development stage and suitability for the steel industry

Macroeconomic challenges facing the decarbonization of steel

Case study examples of decarbonization technology use within steel

Key Highlights

According to the IEA, coal meets around 75% of the energy and feedstock demand of the steel industry. Due to its dependence on coal, steel manufacturing remains one of the largest sources of industrial carbon emissions globally, responsible for approximately 8% of CO₂ emissions.

In most cases, steel producers are targeting 2050 as the year to achieve net-zero. However, Cleveland-Cliffs, Nucor, and Thyssenkrupp have outlined more aspirational targets that encompass scope 1, 2 and 3 emissions.

ArcelorMittal achieved the highest emissions reduction across both 2020 to 2024 and 2023 to 2024. This reduction can be attributed to a combination of over $1 billion invested in decarbonization technologies since 2018 and the sale of its higher carbon footprint assets.

Reasons to Buy

Identify the market trends within the industry and assess what the biggest players in steel are doing to reduce emissions.

Develop market insight of the major technologies used to decarbonize the industry, including an assessment of their development stage and suitability for the steel industry, alongside the drivers and barriers to their implementation.

Facilitate the understanding of what is happening within hard-to-abate industries as they look to become carbon neutral by 2050.

Ansteel
ArcelorMittal
Baowu
Cleveland-Cliffs
HBIS
Hyundai Steel
JFE
Jiangsu Shagang
Jianlong Steel
JSW Steel
Nippon Steel
Nucor
POSCO
Shougang
Tata Steel
ThyssenKrupp
Stahl-Holding-Saar
Uniper
Salzgitter
Stegra
Fidelis Infrastructure
RWE
Engie
H2V Product
Fortescue
ReGa Energy
India Hydrogen Alliance
BP
Meranti Steel
Andritz
Abu Dhabi National Oil
Tenaris
The Technit Group
Marcegaglia Steel
CarbonFree Chemicals
United States Steel
LG Chem
Carbon Clean
BHP
Mitsubishi Heavy Industries
Mitsubishi Development
Boston Metal
John Cockerill
Pacific Steel Group
Oryx Stainless
AM/NS India

Table of Contents

Executive Summary

Steel emissions

The steel industry’s contribution to global CO₂ emissions

Net-Zero Scenario for the steel industry

Steel producers’ net-zero and emissions targets

Net-zero targets for steel producers

Interim emission targets

Scope 1 and 2 emission disclosures

Decarbonization strategies in the steel industry

Key decarbonization technologies in the steel industry

Assessment of the suitability of technologies for decarbonizing steel

Challenges to decarbonizing steel

Hydrogen

Low-carbon hydrogen as an avenue to decarbonize steel

Major players in H2-DRI by region and country

(Leading low-carbon hydrogen owners targeting the steel industry)

Hydrogen case studies

CCUS

Role of CCUS in decarbonizing steel

Largest carbon capture projects dedicated to steel production

CCUS case studies

Electrification

Low-carbon steelmaking using electric arc furnaces

Decarbonizing steel production through electrolysis

Electrification case studies

Secondary Stream Manufacturing

The importance of secondary stream manufacturing

Secondary stream manufacturing case studies

Table

Net-zero targets of selected steel companies

Select steel companies' interim emission targets

Scope 1 and 2 emissions by steel company 2020-2024

Assessment of the suitability of the technologies for decarbonizing steel

Largest carbon capture projects within the steel sector

Advantages and disadvantages of electrolysis technologies

Figures

CO2 emissions per ton steel cast 2010-2023

Global steel production in the net zero scenario 2010-2030

Direct CO2 intensity of the iron and steel sector in the net zero scenario 2010-2030

Net low-carbon hydrogen capacity allocated to the steel industry 2022-2030

Regional breakdown of low-carbon hydrogen allocated to the steel industry by 2030 as of August 2025

Top 15 countires by low-carbon hydrogen capacity allocated to the steel industry by 2030 as of August 2025

Top 10 operators by low-carbon hydrogen project count with steel as the end-use industry as of August 2025

Carbon capture with steel production as facility industry as of August 2025

Top 10 countries by share of active and upcoming EAF projects as of August 2025

Select steel producers renewable energy capacity by type as of August 2025

Production of crude steel by route in the Net Zero Scenario 2018-2030

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