Steel is essential to construction, transport and energy, and it is one of the largest industrial sources of carbon dioxide. Green steel technologies are emerging, but most of the steel produced in the next decade will come from existing plants. Decarbonization therefore has two tracks: improve what runs today and prepare for what comes next.
Where steel emissions come from
The steel industry accounts for a substantial share of global carbon dioxide emissions, commonly estimated at between seven and eleven percent, depending on the year and the method. Emissions depend heavily on the production route.
The integrated blast furnace and basic oxygen furnace route (BF-BOF) uses coke and coal to reduce iron ore to iron, and carries the highest emissions per tonne. The electric arc furnace route (EAF) melts scrap or direct reduced iron with electricity, and its emissions depend largely on the electricity source. Direct reduced iron (DRI) made with natural gas has lower emissions than blast furnace iron, and DRI made with green hydrogen could be close to zero.
Downstream processes such as reheating furnaces, hot rolling, annealing and galvanizing add further energy use and emissions.
Track 1: improve today's operations
Large reductions are possible in existing plants without changing the production route:
- Energy efficiency in the blast furnace, including optimized burden distribution, pulverised coal injection and top gas pressure recovery.
- Recovery and use of process gases such as blast furnace gas, coke oven gas and converter gas for power and heat.
- Reheating furnace optimization, with better combustion control and hot charging.
- Higher scrap use in the converter where quality allows.
- Process control improvements that reduce rework, downgrades and yield losses.
Each percent of energy saved reduces both cost and emissions. Advanced process control and AI-based optimization help operators run consistently closer to the best achievable settings.
Track 2: shift the production route
Longer-term reductions require changes to how iron is made:
- Scrap-based EAF production, which depends on the availability and quality of scrap.
- Natural gas-based DRI feeding EAFs, already established in the Middle East, with the potential to transition to hydrogen as it becomes available at scale.
- Hydrogen-based direct reduction, with pilot and first commercial plants under development.
- Carbon capture applied to blast furnaces or DRI plants.
These are capital-intensive decisions with long lead times. Accurate data on current emissions and energy use is essential to evaluate them.
Green steel and customer demand
Automotive, construction and energy companies are setting their own Scope 3 targets, which creates demand for low-emission steel. Product carbon footprints and environmental product declarations are becoming standard requests in tenders. Producers who can document the emissions of each product, with verified data, are better placed to win this business and to charge for lower-carbon products.
CBAM and steel exports
The EU Carbon Border Adjustment Mechanism covers iron and steel, including many downstream products. Since the definitive period began in 2026, EU importers carry a cost for embedded emissions, with the first declarations and certificate surrender due by 30 September 2027. Producers that supply verified, installation-specific emissions data instead of default values can reduce the CBAM costs their customers face.
Data as the foundation
Steel plants generate vast amounts of process data in their control systems and historians, but it rarely reaches sustainability reporting. Connecting operational data to emissions accounting allows a plant to calculate emissions per product and per route, find where energy is wasted, and test the effect of changes before making them.
How NCV works with steel producers
NCV works with steel producers in Saudi Arabia and India on ESG reporting, framework mapping and AI-based process optimization. For Evonith Steel, SustainOS delivered closed-loop optimization of laminar cooling, writing AI setpoints back to the control system for tighter coiling temperature control. Our consultants and engineers help steelmakers combine operational improvements today with a credible pathway to lower-carbon production.
Our consultants and the SustainOS team can help you apply this to your organization.
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