A-Share Pioneer Research Under Carbon Neutral Target: Steel Industry Accelerates Carbon Peak

Under the background of carbon neutral acceleration, the emission control work of iron and steel industry has been accelerated at both the industry and enterprise levels.

Carbon peaking and carbon neutralization have become an important part of China's development.

Recently, the State Council issued the guiding opinions on accelerating the establishment and improvement of a green and low-carbon circular development economic system. It is proposed that the basic policy to solve the ecological problems of China's resources and environment is to establish and improve the green economic system of low-carbon circular development and promote the comprehensive green transformation of economic and social development.

In 2020, China's energy consumption will cause about 10 billion tons of carbon dioxide emissions, of which industrial carbon emissions are about 3.7 billion tons, accounting for 37%, which is the largest source of carbon emissions outside the power sector.

Some organizations believe that emission control in key industries is the key to carbon neutrality. According to the calculation of Huajin securities, according to the relevant policy path, by 2050, the carbon emission of the industrial sector will reduce by 75% - 95% compared with the base value in 2015, and various industrial segments will undergo a profound decarbonization transformation.

The 21st century economic reporter's investigation found that at present, the control and discharge work of iron and steel, a key industry, has been accelerated at both industry and enterprise levels.

For example, Shanghai announced on February 4 that 314 enterprises including Baosteel (600019. SH) will be included in the list of Shanghai's carbon emission quota management units (2020 Edition). According to the data released by Shanghai Ecological Environment Bureau, the total quota of Shanghai carbon emission trading system in 2020 will be 105 million tons (including direct quota and reserve quota).

"As a matter of fact, Shanghai's carbon emission control started a few years ago, and now we have been put into the quota list because of the carbon neutral policy," Baosteel related people told reporters. "In the past few years, due to the impact of coal restriction, we have been preparing for emission reduction very early."

In addition, for example, Tangshan City announced on February 23 that in order to effectively solve the problem that the high level of three gaseous pollutants affects the air quality ranking, it has decided to start the daily system of in-depth treatment of Engineering emission reduction of iron and steel enterprises from now on.

Steel companies promote "low carbon" and enhance competitiveness

In the context of the acceleration of "low carbon action" in the iron and steel industry, some organizations have called out that "2021 will be the first year for the steel industry to achieve low carbon".

CITIC Securities recently said that the current value of steel investment may exceed the supply side reform period in 2017. On the demand side, driven by the overall macroeconomic recovery, the main line of resonance of manufacturing industry at home and abroad is clear, and the toughness of building material demand is also worth looking forward to. On the supply side, the large background constraint of carbon peaking is expected to bring about more than expected contraction. Judging that there will be a significant gap between supply and demand in the iron and steel industry, and the profit center of the industry is expected to increase significantly.

"Although we haven't seen any substantial impact on industrial production at the current time point, it is estimated that the compression rate of steel supply side this year is higher than market expectations," said CITIC Securities.

The 21st century economic reporter learned that at present, many listed companies in the iron and steel industry are promoting the "low carbon" work, in order to achieve the expected emission reduction goals and enhance the competitiveness of the industry.

Baotou Steel (600010. SH), a listed company in Inner Mongolia, told reporters that the company has been promoting consumption reduction and emission reduction. "We have recycling. Our waste gas, waste heat and waste heat can be used for power generation." The person said that the company's current "cost of self generation has been quite low.".

"In order to gain market advantages, we have set up six sales subsidiaries this year, which are more flexible in mechanism and system, (in order to) improve the enthusiasm of the company's sales staff, so as to sell more and get more." The person said.

According to the announcement of Baotou Steel on January 28, the company plans to set up six wholly-owned subsidiaries in North China, central China, East China, South China, Southwest China and Northwest China. The company has contributed 45 million yuan to each subsidiary in its own currency.

Guangxi iron and steel listed company Liugang shares (601003. SH) related people in an interview with reporters also said that the company continues to promote "carbon neutral" related work.

"We have been doing some energy-saving and low-carbon transformation, production process, structure and equipment in all aspects." Liugang said, "we often participate in low-carbon industry exchanges. We are discussing "carbon neutrality" with the industry, and we may come up with some road maps in the future. "

A number of steel listed companies have told reporters that there are a lot of recent institutional research. Data show that the wind steel index has risen 8.27% since 2021.

Calling out that "2021 will be the first year for the iron and steel industry to realize low carbon", the steel team of Guojin Securities pointed out that after the supply side reform, the problem of disorderly growth at the supply side is expected to be constrained, and the supply and demand will be improved to smooth the profit fluctuation.

"On the other hand, small and medium-sized enterprises with high energy consumption and low efficiency will be eliminated. Through low-carbon innovation (improving production processes, updating production equipment and using low-carbon energy), the competitiveness and concentration of large-scale enterprises will be further enhanced." Guojin Securities said.

Restrictive energy policies have begun to affect the industry

According to the statistics of relevant institutions, at present, three batches of 87 low-carbon provinces and cities have been carried out in China. A total of 82 pilot provinces and cities have proposed the goal of reaching the peak, of which 18 will reach the peak by 2020 and 42 by 2025.

In the context of accelerating carbon neutrality, the process of rectifying high energy consuming industries in some provinces and cities has been accelerated recently. The 21st century economic reporter's investigation found that, taking the iron and steel industry as an example, the impact of restrictive energy policies has been gradually transmitted to the industrial chain and production enterprises in some regions.

Since February, Inner Mongolia and Gansu have successively issued policies to adjust the electricity price policies and power trading policies of some industries.

Taking Inner Mongolia Autonomous Region as an example, Inner Mongolia announced on February 9 that in order to solve the problem of dual control of total energy consumption and intensity, preferential electricity prices for high energy consumption industries and other unreasonable price preferential policies will be comprehensively eliminated, and differential and punitive electricity prices will be strictly implemented.

? ? ? According to the policy requirements, from February 10, the electricity price policy of converting the basic electricity charge of electrolytic aluminum industry in Western Mongolia to 3.39 cents per kilowatt hour and the inverted ladder transmission and distribution price policy of Western Mongolia power grid shall be cancelled; the step tariff policy shall be continued for electrolytic aluminum, cement and steel industry, and the energy consumption standard and price increase standard in 2021 shall be strictly implemented in accordance with the national regulations, and the current basis will be respectively implemented from 2022 and 2023 Increase by 30% and 50%.

Erdos (600295. SH), a listed company engaged in cashmere clothing, mineral resources development and energy comprehensive utilization in Inner Mongolia, told reporters that at present, the policy has been issued, and enterprises will implement it according to the policy. The source said that the dual control of energy consumption during the "14th five year plan" period in Inner Mongolia is very strict, "dual control of energy consumption has an impact on the whole industry, not one or two."

"The adjustment of electricity price policy should have the least impact on us. We only pay 1 cent of cross subsidy per kilowatt hour of electricity. Because we have our own power plant, we only need to pay 1 cent per kilowatt hour. Our power generation is nearly 20 billion kwh a year, which is about 200 million. " The person said.

The reporter of 21st century economic report has noticed that on the interactive platform of listed companies, many days ago, investors have asked Ordos about the impact of electricity price adjustment. Moreover, similar problems also appeared on the interactive platform of Junzheng group (601216. SH), another metallurgical and chemical enterprise in Inner Mongolia.

Erdos people told reporters that at present, the company attaches great importance to energy consumption control. "Our main businesses are ferroalloy and chemical industry, which are energy consumption controlled industries." A survey summary of Ordos on February 24 obtained by the reporter also shows that the company is actively responding to the call of the government and is preparing for capacity replacement internally.

"In fact (Policy) will bring great help to industry supply clearing", Guojin Securities pointed out that the relevant policies in Inner Mongolia will promote zombie enterprises and high energy consumption capacity to exit. "Under the background of carbon neutral, the supply contraction of high energy consuming industries is a major trend, and will continue to ferment. Small enterprises that do not have the advantages of energy consumption and environmental protection will face the risk of elimination. On the contrary, the competitiveness of large enterprises with advantages will be further enhanced. "

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