Climate Group’s Jen Carson talks to Canary Media's Maria Gallucci ahead of Climate Week NYC about the need to accelerate net zero steel and concrete production.
Note: This interview originally appeared on Canary Media.
Steel and concrete form the backbones of our modern infrastructure. Billions of metric tons of both materials are churned out every year to make the world’s buildings, bridges, sewers, electrical grids, and seemingly everything else. But producing steel and cement — the key ingredient in concrete — together generates an estimated 15 percent of all global carbon dioxide emissions.
Slashing those industrial emissions will require a seismic shift away from existing, polluting technologies and toward emerging, cleaner solutions, some of which are already on the market. Manufacturers, investors, and government agencies are slowly making that pivot. But the companies that purchase all that steel and concrete are trying to speed things up by signaling their demand for cleaner materials.
Jen Carson is helping to lead that effort through her work with Climate Group, an international nonprofit with headquarters in London. As head of industry, Carson oversees the group’s SteelZero and ConcreteZero initiatives, which rally businesses to commit to buying net-zero steel and concrete in the hopes of spurring a global market.
Canary Media spoke with Carson in the run-up to Climate Week NYC, starting September 22, where industrial decarbonization will be a major topic. The conversation has been edited for brevity and clarity.
Maria Gallucci: Heavy industry has historically taken a back seat in global efforts to tackle climate change. What’s driving the recent push to focus on industrial sectors?
Jen Carson: There are several strands, not least of which is that we’re genuinely in the age of urgency right now. We just had the hottest 12 months on record, from an air temperature perspective, and 15 months of record-high temperatures for the seas.
It couldn’t be a more apt time for the industrial-transition discussion. We’re at an inflection point with this sector, which used to be called “hard to abate,” but we’re fundamentally seeing that it’s really “must abate.”
One of the real, tangible deadlines is specifically around blast furnaces.
Seventy-one percent of global blast furnace capacity needs to be relined, or reinvestment decisions need to be made, before 2030. That’s in six years’ time. So we’ve got that specific window of opportunity right now to be lining up and ensuring that those higher-carbon assets are substantially shifted toward new production processes. We need to be laser-focused around this challenge.
Gallucci: If all that blast furnace capacity is renewed, that would lock the steel industry into those CO2 emissions for potentially decades, right?
Carson: Absolutely. And that’s one of the reasons why we’re working with the demand side, and those who are setting the expectations, making requirements for the embodied carbon and the level of emissions that they will accept into the materials they buy. The demand side has to continue to signal that dirty production, high-embodied-carbon production, isn’t what they will be using in their business models going forward.
Often in construction and infrastructure, just purely steel and concrete can represent 50 to 80 percent of a company’s Scope 3 emissions. Sustainability departments within organizations are looking at Scope 3, looking at the materials going into their supply chains, and realizing that steel and concrete represent a unique opportunity to tackle a significant amount of those emissions.
Gallucci: What kind of progress have you seen over the last year, in terms of building momentum to decarbonize steel and concrete?
Carson: We’re seeing a movement from individual organizations looking at this and trying to tackle the challenge on their own to mobilizing collectively to do this together across the supply chain and replicate that into mass scale, though we’re not there yet.
We now have a cohort of 45 organizations for SteelZero who have formally made those net-zero commitments and are building them into their pipelines of projects, be it for the steel they’re using in ships, the infrastructure they’re building out, or the automotives. On the concrete side, we now have 39 members that have made commitments for their construction and infrastructure projects.
Some recent examples from SteelZero members in particular include Ørsted and SKF actually making long-term agreements with their suppliers for low-emission steel. While a couple of years ago we saw the stage being set, in terms of pledges, we’re now seeing that come through in putting the commitments into practice.
Also on the steel side, we’re seeing more investment into cleaner direct reduced iron. DRI production actually now accounts for 36 percent of global ironmaking capacity under new development.
In terms of policy, we’re starting to see significant sums of capital investment or finance being directly channeled toward industrial decarbonization, especially over in the U.S. and Europe. [The U.S. Department of Energy has announced $6 billion in awards for demonstration projects that aim to sharply reduce emissions from steel, aluminium, cement, and other sectors.] The support for green product standards is also becoming much more of a dynamic discussion.
Gallucci: What are some of the key challenges delaying this transition?
Carson: Let’s not skirt over the fact that there are investments still going into high-carbon steelmaking. So we need to be scaling fuels like green hydrogen (for clean steel production) and scaling investment into enabling infrastructure on the electricity-generation side of things — both directly for some of these industrial processes but also for green hydrogen facilities to boost supplies as well.
On the concrete side, financing and insurance are other challenges that need to be addressed, especially for those novel concrete technologies and mixes that are readily available on the market but aren’t getting the investment and scale needed to move forward. So we need to make sure that for businesses, it’s no longer tenable to be working toward or integrating higher-carbon materials. We really need to shift that toward those lower-carbon solutions.
Gallucci: How else is Climate Group working to spur the shift toward net zero steel and concrete?
Carson: Climate Group has offices in London and New York, but we also have colleagues based in India and China. So we’re very much at the stage of looking at how the Asia market is operating with industrial decarbonization. Across the SteelZero membership base, there are six organizations that have made the net zero pledge and are engaging now with their supply chains within China. We’re starting to get a feel for and understanding of what the challenges are in that market.
Another core piece of what we’re doing is around data transparency, supply chain engagement, reporting, and methodology — so really looking at the granularity and credibility of information that’s flowing across the supply chain around embodied-carbon emissions data for steel and concrete. We’ve just completed the first beta reporting exercise for these two material streams and are still analyzing what’s coming through. But that’s a key part of the puzzle.
