Pathways to decarbonization of steel industry (Part 1)

Jan 14, 2021

Steel is of great importance in today’s society. Being one of the most important engineering and construction materials, it can be found almost everywhere we go. The steel industry is under great pressure because it needs to reduce its CO2 emissions from an environmental as well as an economic point of view. The steel industry plays a major role in reducing emissions as it is among the three biggest producers of carbon dioxide, which is around 7-10% of global greenhouse emissions. Therefore, steel mills are a good target for decarbonization. Making the steel industry’s processes more environmentally friendly also ensures that the industry can continue to operate in the long term. (Hoffman et al. 2020)

Steel is produced through two main process routes:

  • With blast/basic oxygen furnace (BF/BOF), where the process is integrated, and iron ore is the main raw material
  • Electric steelmaking using electric arc furnace (EAF), where steel scrap and direct reduced iron (DRI) are the main raw materials

The integrated steelmaking route is currently the most widely used method in steelmaking and covers 72% of global steel production. Scrap availability and fuel costs affect the competitiveness of the BF/BOF route when compared to the EAF process. (Ellis & Bao 2020)

The carbon footprint of these two production methods differs significantly. In general, the integrated steel production route releases about two tons of CO2 per ton of steel produced (2.0 t CO2/t steel) in both direct and indirect emissions. Emissions from the DRI process depend on the fuel used. For example, coal-based DRI produces about 2.4 t CO2/t steel while natural gas-based DRI produces about 1.4 t CO2/t steel. However, of all the commercially available technologies, scrap-based EAF steelmaking is the greenest choice. The emissions are about 0.4 t CO2/t steel, depending on the method of electricity production used. Therefore, EAF steelmaking will play a major role in moving towards green, carbon-neutral steel and decarbonization of the steel industry. (Ellis & Bao 2020; Hites 2020)

So why don’t all steel producers switch to the EAF process?

Currently, there is only a limited amount of scrap and DRI in the world, which is not enough for global demand. The use of the EAF steelmaking route will increase, but the pace will be determined, among other things, by the availability of scrap. It is still difficult to predict how the amount of recycled scrap will increase in the future. Furthermore, without adding some pure iron-bearing materials to scrap recycling circulation some harmful components like copper will enrich to catastrophic levels in circulating steel.

Changing the BF-BOF route to EAF based steelmaking and how the change will affect material usage will be discussed in greater depth in Luxmet’s free webinar “Future Challenges in the EAF steelmaking”. The link to the recording of the webinar can be found at the end of this article!

How can the steel industry reduce emissions?

The steel industry can reduce its emissions in three ways:

  • Reducing or eliminating direct emissions from steel plants
  • Reducing or eliminating emissions by using renewable energy
  • Using carbon capture methods for re-use or storage

It is believed that before the steel industry reaches the third and final stage, the near-zero stage, it will go through two other stages: the optimization stage and the transition stage. All three stages will be discussed in the upcoming articles, as well as the role of ArcSpec in the decarbonization journey of the steel industry.

This was the first part of “Pathways to Decarbonization of Steel Industry” article series. Follow our Linkedin to get notified about upcoming news. Click here to read the next part of the article series.

On the 9th of February, in our free webinar “Future Challenges in EAF Steelmaking”, prof. Timo Fabritius from the University of Oulu and Dr. Matti Aula will explain the other rising trends of EAF steelmaking in more detail. Click here to watch the recorded webinar!


Ellis, B. & Bao, W., 2020. Pathways to decarbonization episode two: steelmaking technology [online]. Available at: [Accessed 29 December 2020]

Hites, B., 2020. The growth of EAF steelmaking [online]. Available at: [Accessed 12 January 2021]

Hoffman, C., Van Hoey, M. & Zeumer, B., 2020. Decarbonization challenge for steel [online]. Available at: [Accessed at: 30 December 2020]