Reflections from COP28: Accelerating the Green Steel Revolution

Stefan Håkansson, Chief Clean Energy Officer at GFG, continues his first-hand report on the burning issues at COP28, and shares his unique insights into this definitive climate change event.

Being a few days into COP28 is like being in the middle of a very intense sprint. Tempo is high with exciting progress: examples like Masdar signing renewable wind- and PV projects amounting up to 20 GW, only during COP. Another example is how companies in the first mover coalition, like Volvo and Coca Cola, drive green procurement and have significant results already. A third example is how much SBTi (science based target initiatives) are growing. This leads to increased demand of green products since companies signed on to SBTi need to reduce their scope 1, 2 and 3 targets. This will lead to increased demand of products like green steel. 

In order to meet the customer demand, we need to be ahead of the game when it comes to producing green steel. We have one of the best opportunities to develop that with our plans in Whyalla, Australia. These plans were presented at COP in the Australian Pavilion. Well received with several questions from audience about energy intensity and the pace of building out the energy solutions. Particularly we got questions on the 250 MW electrolysers that are being built by the South Australian Government to ensure Australia takes the lead in becoming a renewable superpower nation.

Another reflection is how the discussions at COP now are much deeper than before. The concept of circularity is deepened, and I participated in discussions where growth comes in a new light. Let me give you an example: steel, cement and other very energy intense industries that want to grow have traditionally been attracted to places where the raw materials are available or where clients are close. New investments have also been heavily influenced by authorities’ willingness to support with investments (subsidies and other kinds of grants). What sometimes have been missing is the system perspective, including energy and its environmental impacts. 

Now being discussed, is if it is right that a government is allowing large grants to grow green field new steel production when there are no additional green energy available. 

From a balanced system perspective, this will most likely lead to increased competition on renewable energy and risk putting industries such as paper, cement and chemical into fossil territory. 

My conclusion is that new energy intensive industrial growth should have allocation principles towards where renewable energy is easiest monetised, specifically when considering products on a global market. 

During COP, GFG Alliance also progressed; here when signing a MoU with Abu Dahbi Ports that has the purpose to develop green ironmaking in Dubai. This region has one of the best prerequisites in the world to do green electricity through PV. A great example that would be adherent to the circularity definition for growth.

COP is also the venue where all leaders are very accessible. We took the opportunity to have many meetings discussing different business matters and specifically the green transition. Here we are in a meeting with Totals CEO Patrick Poyanne, who drives an impressive agenda. They have already 20 000 MW renewable power in operation and have an ambitious target of 100 000 MW by 2030.

So, I am very optimistic that COP28 is driving progress through deeper understanding of system perspective, accelerating the green transition through industrial initiatives and new businesses. I am sure the Green Steel revolution is happening and I am excited to be in a company that aims to lead it!

Pics from exciting situations and panels: