Japan’s Low Carbon Steel Development : Assessing Industry Preparedness

by | Nov 20, 2023 | Trending

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Japan is leading the way in creating new methods for making steel with less impact on the environment. This is really important because making steel is a big part of modern life, but it also accounts for about 11% of global carbon emissions, That’s a big deal for our planet. Understanding this, Japan has set some tough goals to reduce these emissions from their steel industry. They’re putting a lot of effort and money into research and development to meet these goals. With their aim to have net zero emissions by 2050, Japan is playing a key role, especially as they’re one of the biggest producers of emissions from manufacturing. In this article, we’ll have a look into Japan’s low carbon steel development and why it’s so important.

Challenges and Assessing Industry Preparedness

Major players in the Japanese steel sector, such as Nippon Steel, JFE, and Kobe Steel, find themselves at a pivotal crossroads, confronting the formidable challenge of balancing emissions reduction with maintaining competitiveness in the rapidly expanding global green steel market. The industry’s journey is illuminated by a recent report, offering invaluable insights into its preparedness and laying bare essential considerations for sustainable development.

One of the key areas of focus for Japan’s low-carbon steel development is the development of new steelmaking technologies that use less coal and more renewable energy sources. For example, Japan is developing a new steelmaking process called the “Top Gas Recycling Blast Furnace” (TGR-BF) process. This process uses a mixture of hydrogen and natural gas to heat the iron ore, which reduces the amount of coal required by up to 30%.

Japan is also investing in the development of new materials that are lighter and stronger than traditional steel. This can help to reduce the amount of steel used in products, which can further reduce greenhouse gas emissions.

In addition to R&D, Japan is also implementing a number of policies to promote the development and adoption of low-carbon steel technologies. For example, the government is providing financial subsidies for steel companies that invest in low-carbon technologies. The government is also working with steel companies to develop standards and certifications for low-carbon steel products.

Is Japan Ready for the Green Steel Revolution?

Here’s how Japan’s Low Carbon Steel Development is taking place:

1️. Shifting to Electric Arc Furnaces (EAFs)

A pivotal strategy in Japan’s quest for low-carbon steel development revolves around the swift adoption of Electric Arc Furnaces (EAFs). Recognized as a linchpin for the nation’s steel industry, the imperative is to transition away from conventional blast furnaces and embrace the innovative potential of EAFs. This strategic shift responds to environmental considerations and is a proactive measure to meet stringent emissions reduction targets. Integrating EAFs is crucial to securing a formidable position in the evolving green steel landscape, where sustainability is a key determinant of global competitiveness.

EAF technology offers a promising avenue for Japanese steel companies, presenting advantages such as lower emissions and higher recycling rates. The urgency to phase out traditional blast furnaces underscores the industry’s commitment to aligning with environmentally conscious practices. As Japan positions itself in the vanguard of sustainable steel production, the successful integration of EAFs emerges as a decisive factor, shaping the trajectory of the nation’s steel industry in the era of low carbon transformation.

2️. Carbon Budget Challenges

Japan’s steel industry faces a critical challenge as major players are anticipated to exceed their allocated carbon budgets significantly. This overshooting presents a formidable obstacle in Japan’s ambitious pursuit of the 1.5°C target, demanding swift and decisive corrective actions.

The carbon budget, a crucial component of climate action plans, represents the allowable amount of greenhouse gas emissions to limit the rise in global temperature. The fact that prominent entities within the Japanese steel sector are on track to surpass these allocations underscores the urgency of addressing emissions in the industry.

To align with global climate goals and mitigate the impact of climate change, immediate corrective measures are imperative. The steel industry’s ability to adhere to these carbon budgets is pivotal not only for Japan’s national climate commitments but also for its standing in the international arena as a responsible and sustainable player in the fight against climate change. As the industry grapples with these challenges, the spotlight intensifies on the necessity for innovative and aggressive emission reduction strategies to navigate the complexities of a low-carbon future.

3️. Renewable Energy Deployment

The report underscores the critical role of renewable energy (RE) deployment, particularly in powering EAFs. An estimated 1TWh of RE electricity will be required by 2031, escalating to 38TWh by 2050. This ambitious target underscores the magnitude of the necessary shift.

4️. Decarbonization for Supply Chain Sustainability

Decarbonizing the steel industry is more than merely an industry-specific endeavour. It is pivotal for achieving broader sustainability goals, impacting supply chains across utilities, automotive, and construction sectors.

5️. Collaboration for Green Steel

“Green steel” emerges as a driving force demanding collaboration among policymakers, corporations, and consumers. A stringent target set by Responsible Steel and the International Energy Agency advocates for near-zero emission steel, capped at a maximum intensity of 220 kgCO2e per tonne of steel.

6️. Technology Shift: Blast Furnaces vs. EAFs

While the Japanese steel industry predominantly relies on blast furnaces, the potential benefits of EAF technology, including lower emissions and higher recycling rates, should be utilized more. A notable shift among Japanese steel companies is imperative to capitalize on the advantages offered by EAFs.

7️. EAF Integration for Global Competitiveness

The report issues a stark warning – without swift expansion and integration of EAFs, Japanese steel producers risk falling behind global competitors in the green steel market. The urgency to make significant emissions cuts underscores the importance of embracing green technology.

8️. Low or Zero Carbon Iron Production

Transitioning to low or zero-carbon iron-producing technologies is highlighted as a pivotal strategy. Incorporating scrap steel as an input to EAFs is a crucial step toward reducing emissions and promoting circular economy principles.

9️. Aligning Renewable Energy Expansion with EAF Development

To achieve further emissions reductions per tonne of steel and enhance competitiveness internationally, there must be a synergistic alignment between the expansion of renewable energy and the development of EAFs.

10. Addressing the Demand for Green Steel

The growth of EAFs producing Japanese steel has stalled, indicating a potential gap in meeting future demand for green steel. Japan must address this demand-supply mismatch to ensure the continued growth of eco-friendly steel production.

Japan's Low Carbon Steel Development : Assessing Industry Preparedness


Japan’s efforts to develop low-carbon steel production technologies are helping to reduce greenhouse gas emissions and promote sustainable development. These efforts are also helping to make Japan’s steel industry more competitive in a global market that is increasingly demanding low-carbon products. Japan’s low-carbon steel development trajectory is not just an industry-specific concern but a litmus test for the nation’s commitment to a sustainable, net-zero future. The industry’s response to these challenges will shape its destiny and contribute significantly to the broader global efforts to combat climate change.

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  • Farhan Khan

    Farhan is an accomplished Sustainability Consultant with 6-7 years of experience, He specializes in the design and execution of innovative sustainability strategies that not only mitigate environmental impact but also foster social responsibility, thereby enhancing overall business performance. With hands-on experience in ESG and BRSR reporting, as well as a wide array of assessments including gap, baseline, midline, impact, and value chain across various regions in India, Farhan brings a strategic and comprehensive approach to sustainability initiatives.

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