Steel Enterprises Usher In The Tide Of "Carbon Neutral" Transformation, Carbon Emissions Will Decline By 80% In The Next Five Years

For the steel industry, "carbon peak, carbon neutral" is no less than a major change in the supply side structural reform in 2016.

Recently, the always low-key HEC Group held a low-carbon green development action plan conference and released its own carbon neutral action plan. The company announced that it will reach its peak in 2022, reduce its carbon emissions by more than 10% in 2025, by more than 30% in 2030, and achieve carbon neutrality in 2050.

According to this plan, Hegang's own carbon peak progress will far exceed the national goal. Therefore, Hegang is expected to build 3.6 million tons of hydrogen metallurgy by the end of the "14th five year plan". The first phase will use coke oven gas as reducing gas, and the remaining 3 million tons will use renewable energy such as wind energy and solar energy to produce hydrogen by electrolyzing water. At the same time, it plans to build wind and solar power generation projects with an annual power generation capacity of 5 billion kwh.

So far, Baowu group and Hegang, China's two major iron and steel groups with an annual output of more than 160 million tons, have issued their own carbon neutral action plans. "For China's large steel companies, the layout of emission reduction and environmental protection is earlier, and the technical strength is relatively strong." Wang Guoqing, director of Lange Iron and Steel Research Center, said, "for more small and medium-sized steel companies, it may be necessary to introduce third-party professional help to achieve carbon neutrality."

Carbon neutral transformation of steel industry

According to statistics, China's crude steel production accounts for more than 50% of the world's total, and the carbon emission of the steel industry accounts for 60% of the global total. At home, the steel industry accounts for about 15% of China's carbon emissions, and it is the industry with the largest emissions in all industrial sectors. No matter from which perspective, the steel industry should and must make the greatest contribution to the path of China's carbon emissions.

At the ninth meeting of the central financial and Economic Committee held on March 15, the orientation of carbon peak and carbon neutralization was defined, especially the clear "construction drawings" for the next five years. Industry, construction and transportation are the main terminal energy consumption departments in China. The meeting proposed that green manufacturing should be promoted in the industrial field, energy-saving standards in the construction field, and green low-carbon transportation mode should be accelerated in the transportation field.

In the outline of the 14th five year plan released not long ago, it is clear to transform and upgrade traditional industries, promote the layout optimization and structural adjustment of petrochemical, iron and steel, nonferrous metals, building materials and other raw materials industries, expand the supply of high-quality products such as light industry and textile, accelerate the transformation and upgrading of key industries such as chemical industry and papermaking, and improve the green manufacturing system.

At the same time, we will promote the clean and efficient utilization of fossil energy such as coal, promote the green transformation of steel, petrochemical, building materials and other industries, and accelerate the "transit to rail" and "transit to water" in the transportation of bulk goods and medium and long-distance goods. Promote the electrification of urban public transport and logistics distribution vehicles.

Therefore, in the next five years, China's steel industry will face two major tasks: optimization of industrial layout, structural adjustment, and building of green manufacturing system. In fact, for the steel industry, these two tasks can complement each other in the process of gradual realization.

At the beginning of this year, Huang Libin, a spokesman for the Ministry of industry and information technology, said that the reduction of steel production is an important measure for China to achieve the goal of carbon peak and carbon neutralization. The Ministry of industry and information technology will promote the reduction of steel production from four aspects. The Ministry of industry and information technology will study and formulate relevant work plans to ensure that the steel output will be fully reduced year on year in 2021.

Therefore, de production capacity and production reduction will become the most important part of the steel industry in the future, including merger and reorganization, and the upstream and downstream changes of the steel industry will continue to take place.

"Under such policy requirements, it is almost impossible that new steel projects will be launched during the" 14th five year plan "period. If steel enterprises want to achieve capacity expansion, they can only do so through mergers and acquisitions and capacity replacement." Wang Guoqing said.

Therefore, the steel industry to achieve carbon peak, its difficulty is not as big as the outside guess. In theory, as long as the output does not increase, through a series of technological progress and innovation, on the one hand, reduce carbon emissions in the smelting process, on the other hand, develop carbon capture and storage technology, it is expected to achieve carbon peak in a short time.

Taking Hegang group as an example, the company said that in the future, through process reform and new technology progress, carbon emission per ton of steel will continue to decline, but the rate of reduction depends on the degree of technological progress. Under ideal conditions, if all of them are converted into hydrogen metallurgy or scrap short process, the co consumption per ton of steel and coal will be reduced_ 2 emissions will be reduced to 0.4-0.6t, with a reduction rate of 80%.

Industry process innovation

China's iron and steel industry is mostly long process steel enterprises, and the process progress in the smelting process will play a crucial role in reducing carbon emissions.

According to statistics, in the whole process of iron and steel industry, carbon emission is concentrated in the stage of raw material treatment, in which ironmaking accounts for 60% of carbon emission. At present, the mainstream blast furnace ironmaking method causes huge carbon emissions. Therefore, the future technical transformation of the iron and steel industry, including new market opportunities, will also focus on the progress and promotion of this technology.

On March 8, Hegang group and BHP Billiton signed a memorandum of understanding on cooperation. The two sides will focus on greenhouse gas emission reduction in the iron and steel industry, and work together on three key areas, namely, direct reduction of hydrogen iron technology, steel slag treatment and recycling technology, and improvement of iron ore stone utilization rate.

It is reported that BHP Billiton announced a $400 million climate investment plan in 2019. The strategic cooperation with HEC will be a part of the investment plan, and also an important step for BHP Billiton and upstream and downstream of the industrial chain to jointly cope with climate change.

At the end of last year, Baowu Group signed an agreement with Rio Tinto to cooperate on low-carbon iron making projects and research. It is reported that the two sides will jointly invest 10 million US dollars to support the two sides to jointly establish a research and Development Center for low carbon raw materials preparation and a shared test platform for China Baowu low carbon metallurgy innovation center to develop carbon dioxide utilization and conversion technology.

"It is necessary to develop hydrogen smelting technology to the greatest extent to replace the current coke smelting technology." "At the same time, the intensity of hydrogen emission will be far lower than the current electric furnace smelting technology, there is a lot of room for technological progress in this area," a steel industry source told reporters

In the medium and long term, whether it is technology upgrading or production reduction, it is still not enough to offset the current huge amount of carbon emissions. Speeding up the international layout of the industry and increasing the proportion of short process will be the possible way of carbon neutralization in iron and steel industry.

On the one hand, we should speed up the internationalization layout. Encourage iron and steel enterprises to accelerate overseas investment, so as to reduce domestic smelting capacity and reduce total carbon emissions; on the other hand, increase the proportion of short process. Carbon emission per ton of steel in short process is only 1 / 20 of that in long process. Increasing capacity replacement in short process will effectively reduce the difficulty of "carbon neutralization".

And the benefits are obvious. As one of the most important and basic materials in industry, with the growth of China's economy, the demand is expected to remain stable for a long time. Reducing output and other ways can improve the gross profit level of steel mills. Steel enterprises with layout ahead of schedule will also get the dividend of this round of "carbon neutral" market, and the valuation level will be gradually improved.

On the other hand, China's steel industry is currently plagued by a big problem, which is caused by excessive dependence on imported iron ore, which leads to the price surge of the latter. After reducing production, it will also help steel enterprises to get rid of the dependence on imported resources and save costs.

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