Climate action at BlueScope

Climate Action at BlueScope: Advancing Low-Emission Steelmaking

As the global call for sustainability grows louder, industries are being challenged to address their environmental impact. At BlueScope, climate action is not just a commitment; it is integral to the company’s purpose and corporate strategy. Central to this is their vision for Australian operations to be a vibrant, modern manufacturer, embodying progress, innovation and sustainability. Building a pathway to low emission-intensity iron and steelmaking in Australia is a key priority for the business.

Emissions Performance

Port Kembla Steelworks, where BlueScope makes all its steel in Australia, is placed in the ‘top 15% Blast Furnace-Basic Oxygen Furnace performers’ (BF-BOF) for emission intensity in blast furnace-based operations¹. Between FY13 and FY24, the site's emission intensity has declined by 16 per cent to 2.07 tCO2/tonne raw steel, well below the global BF-BOF average of 2.22 tCO2/tonne raw steel². This reduction is largely driven by a significant increase in scrap usage rates in the basic oxygen furnace, as well as higher operational volumes and improved process energy efficiencies. For product-specific emissions intensity, including uncoated, coated and painted products, refer to BlueScope’s Environmental Product Declarations.

Taking action in Australia

BlueScope has outlined an ambitious decarbonisation pathway for Port Kembla Steelworks, aligned with their global target to reduce steelmaking emissions intensity by 12% by 2030³ and achieve net zero emissions by 2050.⁴

BlueScope takes a dual-stream approach to decarbonising its iron and steelmaking operations. This strategy focuses on both the near-term processes of asset optimisation and longer-term technology evolution.

Meeting 2030 targets

BlueScope’s efforts to optimise current operating assets across the Australian footprint are ongoing. Maximising the use of scrap steel at Port Kembla Steelworks remains a key focus, increasing the proportion of scrap used in the BOF helps reduce emission intensity. Through optimising the inherent chemical and heat energy within the BOF process, capital upgrades and operating practices have allowed a significant increase in scrap additions since 2018. BlueScope has increased scrap use in the steelmaking process from approximately 21.5% to 25.4% over the past five years. This is world leading performance for a BOF and they are looking to go further. ⁵ 

Additionally, trials of biochar, a type of biocarbon produced from sustainable biomass, are being conducted. In 2023, BlueScope successfully conducted biochar trials at Port Kembla Steelworks, co-funded by the Australian Renewable Energy Agency (ARENA) ⁶. These trials included:

• Testing how biochar would perform as a replacement for Pulverised Coal Injection (PCI) coal in the blast furnace.
• Achieving up to 30% PCI coal replacement.

Sourcing cost-effective, sustainably produced biocarbon ⁷ in the quantities needed for commercial adoption presents challenges. BlueScope is working with several prospective sustainable biocarbon suppliers to explore the potential for an industrial-scale supply chain in Australia.

Decarbonisation pathway to 2050

BlueScope is focussed on developing a clear pathway to low emissions ‘primary’ steelmaking in Australia. Direct Reduced Iron (DRI) is considered the most prospective technology to decarbonise the Australian business. They are investigating accelerated technology developments in natural gas Direct Reduced Iron (DRI) as a transitional pathway to using green hydrogen to produce lower emissions steel.

In February 2024, BlueScope announced a new framework agreement with Rio Tinto and BHP to accelerate the decarbonisation of steelmaking by jointly investigating the development of the country’s first ironmaking electric smelting furnace (ESF) pilot plant. In December 2024 the Kwinana Industrial Area, south of Perth was announced as the location to develop the ESF pilot plant. 

“We believe the development of ESF technology is key to unlocking Australia’s unique advantages in this decarbonisation journey – and, more importantly, has the potential for wider adaptation across the global steel industry. We believe that this collaboration where we can contribute BlueScope’s unique experience in operating an ESF, will be key to cracking the code for Pilbara ores in low emission-intensity ironmaking,” said Tania Archibald, Chief Executive Australian Steel Products

Enabling Net Zero

BlueScope acknowledges that achieving their 2050 net zero goal is highly dependent on a range of key enablers, requiring collaboration and action across multiple sectors and stakeholders. These enablers include: development and diffusion of ironmaking technologies to viable and commercial scale; access to appropriate quality and sufficient quantities of economic raw materials; access to internationally cost-competitive, firmed large-scale renewable energy; availability of competitively priced green hydrogen, with natural gas enabling the transition to green hydrogen; and supportive and consistent policies across all of these enablers to underpin decarbonisation.

BlueScope is committed to transforming its operations and fostering industry-wide change through climate action. With clear goals, innovative collaborations, and a focus on transparency, BlueScope aims to lead the steel industry’s transition to a low-emissions future.

For further information, please visit bluescope.com/sustainability/climate-action.

Image: Penguin Parade Visitor Centre, Philip Island, designed by Terroir. 

Photography by John Gollings.

^{1 worldsteel CO2 Data Report 2023 (2022 data year) has the Port Kembla Steelworks site in the lowest 15th percentile for emission intensity of BF-BOF steel plants. Note that this data is limited to those iron and steelmakers who voluntarily report on emissions data with worldsteel (56 BF-BOF sites in 2022 representing 17 per cent of global BOF steel production and 53 per cent of global BOF steel production excluding China. No Chinese steel plants report CO2 data to worldsteel).} 

^{2 Based on steelmakers who reported to worldsteel in 2023 (with 2022 data) where co-product production is applied to the BF-BOF routes considered.} 

^{3 Applies to BlueScope’s Scope 1 and 2 emissions, relative to a 2018 baseline.}

^{4 This goal applies to all of BlueScope’s global operational Scope 1 and 2 GHG emissions, and is dependent on several enablers, including the development and diffusion of ironmaking technologies to viable and commercial scale; access to appropriate quality and sufficient quantities of economic raw materials; access to internationally cost-competitive, firmed large-scale renewable energy; availability of competitively priced green hydrogen, with natural gas enabling the transition to green hydrogen; and supportive and consistent policies across all of these enablers to underpin decarbonisation}

^{5 The average recycled content in the steel is 23.3% which includes pre- and post-consumer recycled materials. Materials reclaimed within the steelmaking process represent an additional 2.1% average recovered content. According to recycled content categories defined in ISO 14021:2016. The figures provided are based on FY24 data.}

^{6 This Project received funding from the Australian Renewable Energy Agency (ARENA) as part of ARENA’s Advancing Renewables Program. The views expressed herein are not necessarily the views of the Australian Government, and the Australian Government does not accept responsibility for any information or advice contained herein.}

^{7 This includes sourcing biocarbon in line with BlueScope’s responsible sourcing guidelines, as well as ensuring appropriate treatment and capture of emissions from such sources.}