Steel Mills

SDI Targets Carbon Neutrality by 2050

July 7, 2021

Steel Dynamics Inc. (SDI) aims to be carbon neutral at its electric arc furnace (EAF) steel mills by 2050.

The steelmaker has also set interim emissions reductions goals for 2025 and 2030. Namely, it plans to reduce combined Scope 1 and Scope 2 greenhouse gas emissions at its EAF mills by 20% by 2025 and by 50% by 2030.

SDI “Our Scope 1 and Scope 2 emissions are already among the lowest in the industry. We are embarking on a path to carbon neutrality from a position of strength,” SDI Chairman, President and CEO Mark Millett said in a statement.

Scope 1 refers to emissions generated directly by a producer such as a steel mill. Scope 2 refers to emissions related to the energy that powers that company. And Scope 3 includes other emissions associated with a mill’s manufacturing process—such as emissions embedded in imported pig iron.

SDI also aims to increase its use of renewable electrical energy – including via partnerships with local utilities – by 10% by 2025 and by 30% by 2030.

The company said that its steelmaking operations are already within a threshold designed to meet Paris Agreement targets. That accord, signed in April 2016, aims to keep global temperatures no more than 2 degrees Celsius above those before the Industrial Revolution.

SDI wants to go further.

“With these new targets and a proven track record of progress, we are demonstrating that steel must continue to play a critical role in the ‘green’ transition,” Millett said.

U.S. EAF steelmakers have a leg up on the competition, for now, because of widespread use of natural gas and recycled scrap, and because the EAF route emits less carbon than the blast furnace route, which depends on carbon-intensive coking coal.

But steelmakers in Europe – take SSAB and ArcelorMittal Europe, for example – are already exploring hydrogen-powered EAFs charged with direct-reduced iron (DRI), a process that would emit water instead of CO2 and that would have a lower carbon footprint than U.S. EAFs reliant on natural gas.

The potentially high cost of hydrogen-based steelmaking, however, remains a sticking point.

Decarbonization will be a major topic discussed at this year’s SMU Steel Summit Conference. SDI CEO Mark Millett will be a featured speaker. You can learn more about this year’s conference agenda by clicking here, or going to: https://events.crugroup.com/smusteelsummit/home

By Michael Cowden, Michael@SteelMarketUpdate.com

Michael Cowden

Michael Cowden is managing editor for Steel Market Update. Cowden has covered the steel industry since 2007. He specializes in flat-rolled steel but has also reported on steel long products, steel pipe and tube, and aluminum. Before joining SMU, Cowden held reporting jobs at Fastmarkets AMM in Chicago, the Associated Press in Pittsburgh, and the Cambodia Daily in Phnom Penh. He has also worked as a copy editor and in marketing at the University of Chicago Press. Cowden has a BA in English from the University of Chicago and an MSJ journalism from Northwestern University’s Medill School of Journalism. Contact him at michael@steelmarketupdate.com or 724-759-7872.