The chief executive of climate change at BlueScope has addressed investors for the first time in her new role, indicating breakthrough technologies that will allow the company to transition to green steel production are not likely to be available until the 2040s.
Gretta Stephens was named to lead the steelmaker’s climate change team in February as the business formalised its commitment to net zero greenhouse gas emissions across its operations by 2050.
During her presentation at the company’s investor briefing on Monday, Ms Stephens said while the decarbonisation process was technically feasible, it was still a long way from being commercially viable.
She said it would be dependent upon access to affordable renewable energy, the availability of competitively priced hydrogen as well as government policy settings that supported the company’s investment.
“While there’s lots of research and development underway, the technology is still decades off,” Ms Stephens said.
“If I were looking at what the potential pain points are, it’s about building out the renewables and the hydrogen industry to be able to support the technology that we’re reasonably confident, will emerge, given the impetus for it.”
In the short to medium term, she said the company would aim for a 12 per cent improvement in its scope one and two greenhouse gas emissions across its steelmaking business by 2030, and 30 per cent improvement in the same emissions for its midstream operations.
BlueScope is continuing to seek a reline of its number six blast furnace at Port Kembla, in the New South Wales Illawarra, by 2026, which would include options for incorporating emerging technologies.
Ms Stephens said BlueScope was also collaborating with iron ore producers Fortescue Future Industries (FFI), BHP and Rio Tinto to develop solutions that would help reduce emissions across the industry.
“The steelmakers can’t solve green steel alone,” she said.
“It needs this enormous amount of renewable energy and an entire hydrogen industry to be built up and that’s not going to be BlueScope alone doing that.”
‘Rapidly evolving space’
When questioned about whether Australian steel would be considered “dirty” if its policy and technology lagged relative to other parts of the world, chief executive Mark Vassella said that would be a problem for BlueScope.
“If we got frozen out because of energy costs or policy decision then that would be an issue for us,” he said.
“If you painted a hypothesis that said we were left with some sort of structural cost disadvantage, because of policy, that would be a problem for us, no question.
“But I’m eternally optimistic about this … this is such a rapidly evolving space, I’m certain there will be technical solutions both for blast furnaces and for electric arc furnaces,” he said.
Mr Vassella said the company was continuing to engage with the New South Wales and Federal governments on developing a policy framework.
“[We] have argued long and hard around a reliable, renewable and affordable energy and the policies that we need that allow us to transition from our current fleet of fossil fuel-based energy systems, to what we all hope and think is the future in terms of renewable energy,” he said.
“For a business like ours that has a very high base load that needs that base load available 24/7, we’re not in a position that renewable energy is the answer for us.”
The two-day investor briefing follows the release of the company’s climate action report at the beginning of the month, and amid an expansion of its North Star business in the United States.
Mr Vassella also revealed the company was considering diversifying its offering in the US, with the possible establishment of a painted and coated steel products plant on the east coast.
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