Outside Track: Finnish steel maker leading green transition
13 Dec 2024
ERJ's Outside Track reports cover news, views & developments from across the wider process and manufacturing industries worldwide
London – Finnish steel maker Outokumpu is not relying on European regulators for protection against imports produced at low-cost but with high carbon-footprint in other regions.
That's in part because EU measures, such as the Carbon Border Adjustment Mechanism (CBAM) "are full of holes like a Swiss cheese,” according to the group’s chief technology officer Stefan Erdmann.
More effective, believes Erdmann, are the group's own efforts to hugely reduce the carbon footprint of Outokumpu’s manufacturing processes and products without increasing costs to customers.
With sales of around €7-billion, earnings (adjusted EBITDA) of €517 million and 8,500 employees, Outokumpu claims to be the no 1 player in Europe’s stainless steel market and no 2 in the Americas.
Production of steel – both carbon and stainless – accounts for 10% of global greenhouse gas emissions, with waste as the main byproduct, Erdmann set out at a recent press event* in London.
China represented around 54% of global steel production in 2023, up from 17.5% in 2000, the CTO noting that “different regions are on very different decarbonisation pathways.”
Outokumpu is the “carbon footprint benchmark” in the stainless steel industry, claimed Erdmann, adding that the Finnish producer is a leader in offering Scope 3 reduction potential for customers.
The group, he said, has reduced its carbon footprint “by up to 75%” compared to the industry average: largely through the use of over 2 million tonnes/year of recycled steel in its production processes.
Other enablers, he said, were: “Switching from fossil coke to bio-coke and to low-emission raw materials, reducing dependency on fossil energy, increasing efficiency & yield, and innovations such as carbon capture.”
Outokumpu has also been prioritising investments, including improving the energy-efficiency of its furnaces and heat treatment lines, and effectiveness of its energy-management system.
Last year, the group implemented around 100 projects delivering 215GWh of energy savings, which cover about 36% of its commitment to reduce consumption by 600GWh, continued the CTO.
To develop its position further, Outokumpu aims to reduce emissions-intensity from direct, indirect and supply-chain sources by 42% by 2030 – from a 2016 base year – without offsetting.
“We have analysed measures to reduce emissions for categories covering 93% of our current total emissions across all scopes,” stated Erdmann.
In meeting an expected surge in demand for sustainable stainless steel, Outokumpu is also focused on providing the transparency needed for customers to deliver their emission-reduction targets.
In this regard, Erdmann said the Finnish group has produced new environmental product declarations (EPDs) that provide externally verified data on its stainless steel products.
These EPDs, he said, will improve data transparency in the stainless steel value-chain and help customers to choose materials that help them to reduce their carbon emissions.
*First Friday Club press event, organised regularly by Cadence Industrial & Technical Communications.
