Chinese steel industry expected to join ETS this year

Chinese steel ETS

According to the China Iron and Steel Association (CISA), China's steel industry is expected to join the national carbon emissions trading market (ETS) this year. Low-carbon steel production standards are being researched and expected to be announced later this year. As a result, the steel industry is expected to participate in carbon emissions trading soon.

In the past two to three years, about 80 major Chinese steel companies have started carbon emission trading pilot projects, with a combined annual steel production of about 130 million tons. Carbon emissions trading is expected to enhance the market competitiveness of low-carbon steel enterprises, promote the development of low-carbon steel production technologies and increase the premium of related products.

From 2014 to 2023, the average integrated energy consumption per ton of major Chinese steel companies will decrease by 5.87%. In addition, 95 companies have shifted to ultra-low emission steel production, adding about 450 million tons of annual production capacity. In addition, 42 steel companies with a total production capacity of 144 million tons have completed partial transition, while another 32 companies are in the process of transition.

To achieve ultra-low emissions, steel companies need to invest more than 400 yuan (about $55) per ton in additional costs, with maintenance costs exceeding 70 yuan per ton. Therefore, CISA urges the government to support companies that have completed the transition and promote the development and application of low-carbon technologies.

China aims to reduce carbon emissions from major industrial sectors by about 1% of the national level in 2023 in 2024-2025. In addition, China plans to reduce energy consumption and carbon dioxide emissions per unit of GDP by about 2.5% and 3.9%, respectively, by 2024.

The inclusion of Chinese steel companies in the national carbon emissions trading market is expected to promote the development of low-carbon technologies and enhance their competitiveness in the market.