Steel Industry Measures to Combat
Global Warming
Voluntary Action Plan Progress Report

December 2012

The Japan Iron and Steel Federation

INDEX
1. FY2011 Report for Voluntary Action Program
2. The Goals and Vision of Japan’s Steel
Industry
3. Requests Concerning Initiatives in Japan2

1. FY2011 Report for Voluntary Action Program
Highlights of this year’s report As FY11 crude steel production declined to the 102 million-ton level,
partly because of the impact of the earthquake, energy consumption
was 9.3% less than in FY1990.
 The steel industry will continue to focus on energy conservation(investments to conserve energy leading up to FY2012 (equivalent to▲0.2%)) and use the Kyoto Mechanism as required (current contract
volume is 27 million tons, equivalent to ▲2.7%) to increase theprobability of reaching the target.

3

FY2011 Report for Voluntary Action Program

Voluntary Action Program of Steel Industry
1. Conserve energy with more efficient steel production processes• Assuming annual crude steel production of about 100 million tons, the goal is to achieve a 10%
reduction in energy consumption used by steel production processes by fiscal 2010 comparedwith fiscal 1990, the reference year.
• However, even if crude steel output exceeds 100 million tons, the steel industry is determined to
do what is needed, including use of the Kyoto Protocol mechanisms, to reach this target.
• The 10% reduction is to be achieved based on average energy consumption for the five-year
period ending in fiscal 2012
*A 10% cut in energy consumption is viewed as equivalent to a 9% cut in CO2 emissions.

2. Contribute to energy conservation outside the steel industry(1) Reuse one million tons of waste plastics and other materials, assuming that the required
collection system can be established.
(2) Use steel products and byproducts to contribute to energy conservation(3) Use international technical cooperation to contribute to energy conservation(4) Utilize unused energy at steel mills in neighboring areas(5) Increase activities involving consumers, businesses and transportation

3. Development of revolutionary technologies• Technology to separate CO2 from blast furnace gas for recovery• Iron ore reduction technology using modified hydrogen from coke oven gas
4FY2011 Report for Voluntary Action Program

Voluntary Action Plan Progress Toward Reduction Targets(Fiscal 2011 Performance)• FY2011 crude steel production of 102,377 thousand tons wasdecreased 2.2% compare to fiscal 1990 (90 participating companies).
• In this environment;
Energy consumption was 9.3% less than in FY1990
CO2 emissions were 8.5% less than in FY1990• Unit energy consumption was down 7.2% from FY1990 and unit CO2
emissions were down 6.4%.
*CO2 emissions in this presentation are calculated by using electric power coefficients after reflecting emission credits.

Reference: Data for entire Japanese steel industry•

FY2011 crude steel production was 106,462 thousand tons which is 4.7% lessthan in FY1990•

Energy consumption was 9.6% less than in FY1990•

CO2 emissions were 8.6% less than in FY1990* Energy consumption is total of steel producers. CO2 emissions were estimated based on "Current Survey of Energy Consumption".

5

FY2011 Report for Voluntary Action Program

Energy Consumption
Unit Energy Consumption(Based on FY1990)

Total Energy Consumed
(PJ)

2,500

▼9.3%
▼3.7%
▼8.4%
▼9.1%
▼11.3%

2,000

▼5.2%
▼6.8%
▼7.2%
▼8.2%

2,348

102.0

2,233

98.0

▼11.5%

2,272

2,216

2,312

100.0

2011年度▼7.2％

96.0▼17.2%

2,275
2,158
2,212
2,018

2,262

2,239

2,164

100.0

▼6.7%

2,379
2,439

▼10%

▼2.4%

94.0
92.5

2,195

92.0
91.4

90.0
88.0

1,500
1990

Crude
steel
粗鋼 105
output

1995

2000

01

02

03

04

05

06

07

08

09

10

2011
(FY)
（年度）

93

101

98 104 106 108 108 113 117 101 94 108 102

TARGET
目標

92.8

90.9

87.4

86.0

100

(FY)
（年度）

(Million
tons)
(百万t)

*PJ is a petajoule (1015 joules). One joule is 0.23889 calories. 1PJ is equivalent to about 2.58 million kiloliters of crude oil.

6

FY2011 Report for Voluntary Action Program

CO2 Emissions from Fuel Combustion
CO2 Emissions from Fuel
Combustion
210

Unit CO2 Emissions(Based on FY1990)(百万t-CO2)(Million tons of CO2)

▼8.5%
200
▼4.4%

190
180

▼8.5%
▼8.3%
▼10.8%

200.6

102.0

▼5.2%
▼6.3%
▼7.3%
▼6.8%

191.8

150

187.9

183.9

100.0

2011年度
▼6.4％

96.0

93.6

94.0

190.2

176.2

186.2
183.7
165.4

187.0

186.0

178.9

98.0

▼17.5%

197.1

183.6

100.0

▼7.3%
▼12.2%

170
160

▼9%

▼1.7%

140

182.6

92.1
92.0
90.0
88.0

130

90.7

90.4

88.0

86.0

120
1990

Crude
steel 105
粗鋼
output1995

93

2000 01

02

03

04

05

06

07

08

09

10 2011

101 98 104 106 108 108 113 117 101 94 108 102

TARGET

目標

100(Million tons)
(百万t)

7

FY2011 Report for Voluntary Action Program

Causes of Change in FY11 Energy Consumption
 FY2011 energy consumption was 9.3% less than in FY1990 because of a 2.2% decrease in
crude steel production and a 7.1% improvement in unit energy consumption.

（ＰＪ）
2,500

▲226PJ（▲9.3%）

54

2,400

Production
volume
生産変動（▲2.2％）
2,300

172
2,439

2,200

improvementof
原単位改善
energyintensity（▲7.1％）（1－0.022）×7.2％=7.1％

2,100※生産変動要因を除いたもの* Exclude
production changing factor

2,212

2,000

1990

2011
8

FY2011 Report for Voluntary Action Program

Outlook for Achievement
 Since entering the target period, average energy consumption for the four-year period from
FY2008 to FY2011 was ▲11.2% vs. FY1990, which exceeded the target of ▲10%. This was due toenergy conservation measures as well as a sharp drop in production activity following theLehman shock.
 In FY2012, the final year, crude steel output is currently at an annualized level of 108 million tons.
We believe that the target is very likely to be achieved due to benefits of further energy
efficiency improvements (▲0.2%) and other reasons.
EnergyConsumption Reduction vs. FY1990 in the Target Period
目標期間におけるエネルギー消費量90年度比削減率の推移(for companies（自主行動計画参加会社ベース）
participating in the Voluntary Action Program)

9

FY2011 Report for Voluntary Action Program

Outlook for Energy Conservation Measures(Ref.) Steel Industry Environmental/Energy Conservation Investments

 The steel industry made investments of about¥3 trillion between FY1971 and FY1989 forenvironmental protection and energy
conservation. These investments totaled about¥1.7 trillion between FY1990 and FY2010.

¥100 million

Cut energy use by 20%

Goal is a further cut of 10%

Capital expenditures of ¥3
trillion from FY1971 to FY1989

Capital expenditures of ¥1.7 trillion
from FY1990 to FY2010

50,00045,00040,000 Total energy to be conserved by projects

35,00030,000under consideration by Japanese steelmakers
to FY2012 will cut energy consumption by
about 0.2% vs. FY1990.
About 97% of these projects have been
approved.

25,00020,00015,00010,0000 Specific actions are listed below.

1971
1972
1973
1974
1975
1976
1977
1978
1979
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
(FY)
（年度）

5,000

Source: ~FY2011: METI Survey on Capital Investments of Major Industries
FY2002~: METI Survey on Corporate Finance (former Survey on Capital Investments)

FY12 Energy Conservation Measures and Composition(% share)Exhaust heatrecovery

Increase TRTs, install CDQs, improve efficiency of exhaust heat recovery fromprivate power generation equipment

30

Enhanceequipment
efficiency

Improved heat insulation, more efficient furnace blowers, adopt sintering
technologies based on hydrocarbon gas, more efficient power generation
stations, etc.

49

Improve
operatingefficiency

Oxygen liquefaction equipment, improved mineral ore mesh, optimization ofsintering grain growth (reduction of setting material), smaller ratio of reducing
agent furnace refurbishment

13

Effective
reuse ofmaterials

Reuse of waste plastics, etc., more waste plastic treatment equipment, others

4

OthersFuel switching

4(Ref.) Increase in Use of CDQ and TRT

CDQ

End
of FY11 93%
2011年度末
93%

TRT

100%

0

20

40

60

80

100 (%)

10

FY2011 Report for Voluntary Action Program

Use of Kyoto Protocol Mechanisms
Use these mechanisms as a supplementary means of achieving the goal.
(1) JISF investments in Japan Greenhouse Gas Reduction Fund and Bio Carbon Fund:
Total of 1 million tons
(2) Starting steel energy conservation technology (CDQ/China, Sintering exhaust heatrecovery/Philippines) and steel engineering technology (CFC treatment, etc./China)
CDMs and other projects: Total of 26 million tons
Signed contracts to purchase 27 million tons (5.4mn tons/year = ▲2.7% of 1990
reference)
26 million tons of this amount has been registered with the UN (5.2mn tons/year =▲2.6% of 1990 reference)
CDM Projects of Japanese Steelmakers (UN Registered)*1(10,000t CO2 emission
reduction CO2/year)

Amount for firstcommitment period(10,000t CO2/year)

CompanyCountry

Project

Nippon Steel
Mitsubishi Corp

China

Shandong Dongyue HFC 23
destruction project

1,011

7 years starting inJuly ‘07

1,000 *2

JFE SteelPhilippines

Power generation using exhaust
heat from sinter cooling equipment

5.5

10 years starting inJan. ’08

27.5

Credit period

Notes: *1.These materials are for projects conducted by steelmakers; total is 47mn tons of CO2*2. Only Nippon Steel’s portion of contractual credits for this project11

FY2011 Report for Voluntary Action Program

Reuse of Waste Plastics etc.
10,000（万ｔ） tons
Full enactment of Japan’s Containers「容器包装リサイクル法全面施行」
and Packaging Recycling Law
Startof reuse of general waste plastics
一般廃棄物系廃プラスチックのas products (April 1, 2000)
再商品化開始（2000年４月１日）

50

37

40
27

30
20

29

42

45

42
37

37
32

40

35

15
8

10
3

3

0
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 201112

FY2011 Report for Voluntary Action Program

Effective Use of Waste Plastics etc.
 Due to priority on recycling materials, purchased 250,000 tons of waste plastics in FY2011 under thecontainer and packaging recycling system; current waste plastic processing capacity in the steel industry
is about 400,000 tons, leaving significant unused capacity (utilization rate is slightly over 60%)
 A review of policies can produce a big drop in CO2 emissions through the effective use of waste plastics,
etc. We hope to see a quick reexamination of recycling systems from the following standpoints.
(1) From the standpoint of efficiently and effectively using waste materials (recycling waste materials that are highly effective at cutting CO2
emissions and have a low social cost), the container and packaging recycling system should stop placing priority on recycling materials that
produce only small reductions in CO2 emissions.
(2) A payment system should be considered to provide incentives to local governments that cut costs below a certain level or make big
improvements; this would lower the social cost of recycling by encouraging local governments to improve efficiency of collecting and storing wastematerials in separate categories(3) Collection of waste materials should not be restricted to items covered by the Container and Packaging Recycling Law; collecting product plastic
waste and other materials too could reduce the need for consumers to discard trash by category and reduce the trash classification expenses for
local governments. The government should thus consider enlarging recycling activities to include more types of materials.

Volume Purchased and Unit Price by Method for Recycling
Container and Packaging Plastics

Materials Received, Products Sold and Reuse Ratio by Method(FY2011)400

100%

Volume received from municipalities
Sales of 市町村からの引取量
materials reused as products
再商品化製品販売量(千ｔ)(thousand tons)

350
300

84%

250
200

50

Coke
コークス
Materials
材料

677,731
679,023
668,086
672,181

49%
40%
Processing volume: Material recyclers＞Chemical
引取量：ﾏﾃﾘｱﾙﾘｻｲｸﾙ＞ｹﾐｶﾙﾘｻｲｸﾙ
recyclers

500,000¥94,200¥88,500¥81,500

400,000

364,733

466,991 ¥109,300¥73,000

288,944 ¥76,700¥74,200
233,312300,000

20%

200,000¥140,000¥120,000¥106,200 ¥107,900¥100,700¥100,000¥89,400¥69,700¥73,379¥77,725¥74,498 ¥71,583¥80,000¥62,800¥60,000¥51,630¥43,334

Product volume: Material recycles < Chemical
製品販売量：ﾏﾃﾘｱﾙﾘｻｲｸﾙ＜ｹﾐｶﾙﾘｻｲｸﾙ
recyclers

0629,323574,657 592,379¥109,300 ¥106,400 ¥108,000(chemicals)

price (materials)

700,000
600,000

Weighted average unit price
加重平均単価（ケミカル）

Weighted average unit
加重平均単価（材料）

80%

60%

150
100

Oil
油化

Blast
高炉
furnace
Gas
ガス化

tons

Reuse
ratio
再資源化率

From municipalities
市町村からの引取量
Sales of materials
再商品化製品販売量
reused as products
Reuse ratio
再資源化率

Purchases
落札量¥38,646 ¥37,631

104,165¥40,000¥20,000

100,000

0%
ﾏﾃﾘｱﾙﾘｻｲｸﾙ
Material
Recyclers

ｹﾐｶﾙﾘｻｲｸﾙ
Chemicalrecyclers（高炉･ｺｰｸｽ炉）（Blast furnace,coke oven)

Source: The Japan Containers and Packaging Recycling Association¥00
12年度 13年度
FY2000
01

14年度
02

15年度
03

16年度
04

17年度
05

18年度
06

19年度
07

20年度
08

21年度
09

22年度
10 23年度
11

FY11
unit purchase price for recycled materials was
平成23年度の材料リサイクルの落札単価は7.2万円/¥72,000/ton
and ¥38,000/ton for chemicals
トンに対してケミカルの落札単価は3.8万円/トン

13

FY2011 Report for Voluntary Action Program

CO2 Emission Reduction from Blast Furnace Slag Used in Cement• Plan for reaching Kyoto Protocol targets assumes a higher pct. of mixed cement (mainly
blast furnace cement) as CO2 reduction in non-energy fields. The plan estimates 24.8% in
FY11 and FY12, but actual figure was only 21.1% in FY11
• Higher pct. of mixed cement production can significantly cut CO2 emissions• Blast furnace cement was designated in 2001 as a specified
procurement item under Japan’s Green Procurement Law.
• National and other green procurement programs along withgreen procurement efforts of local governments and agencies
can significantly cut CO2 emissions by further increasing use of
blast furnace cement.
Estimate of CO2 Emission Reduction from Use of Blast Furnace Cement (Domestic + Exports)） )(10,000（万t-CO
tons of 2CO
2

1,000

Export輸出

716 746

800
600

Domestic
国内

511

577 165

191

806
283

847
774
381

924 921 911

886

441 464 472 465

271

928 9640

生産比率（％）
Ratio(%)

2011年度の見込み
Estimatefor FY11

30
21.8

25
20

20.8 20.8

15

22.8 22.1 21.1

24.8

(Actual)
(実績)

21.6

要3.7ﾎﾟｲﾝﾄ
Need anotherＵＰ~3 point up

5

454

569

609

0

1970

1990

2005 2006 2007 2008 2009 2010 2011 (FY)
年度

53

400
200

Plan for reaching Kyoto
京都議定書
Protocoltarget
目標達成計画

10

842

47

464

Production ratio of mixed cement

525

550

555
523

503

465

483

456 439421 388 360 355

1990 1995 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 (FY)
（年度）

Assumptions for emission reduction contribution
Conversion to volume of cement: 450kg of slag/ Ton of cement
CO2 emission reduction: 312kg of CO2/Ton of cement

Replacing conventional cement (Portland
cement), which generates CO2 during thefiring of raw materials, with slag cement,
which does not generate CO2 during
production, reduced CO2 emissions by
9.64mn tons/year (FY2011).
• Japan: Annual reduction of 3.55mn tons of CO2• Exports: Annual reduction of 6.09mn tons of CO2

14

FY2011 Report for Voluntary Action Program

Initiatives for Transportation• CO2 emissions per unit of cargo transport decreased to 45.1kg of CO2/k ton-km in FY2011 from 44.4kg of
CO2/k ton-km in FY2010.
• In FY2011, the steel industry modal shift (ships + rail) was 78% for primary transportation and 96% forcargo transported more than 500km. This is far higher than the average modal shift rate of 38.1% for allindustries in Japan (Ministry of Land, Infrastructure and Transport FY05 data for more than 500km).
• Steelmakers are taking other actions too, such as improving cargo transport efficiency by using a higher
pct. of cargo space on ships, using eco-tires on trucks and using eco-friendly driving methods.

(kg of CO2/k tons-km)(kg-CO2/千トン・km)

70.00

CO2 Emissions
per Unit of Cargo Transport
輸送量当たりCO2排出量

60.00
50.00

44.4

45.1

FY20102010年度FY2011
2011年度

40.00
30.00
20.00
10.00
0.00
Note: (注)調査協力50社のガソリン、軽油、重油の使用に伴うCO2排出量の合計を輸送トン・kmで除したもの。
Total CO2 emissions from use of gasoline, light oil and heavy oil at the 43 companies surveyed divided by total ton-kilometers of cargo transported

15

FY2011 Report for Voluntary Action Program

Private Sector Initiatives• In FY2005, Japan’s steelmakers started energy conservation
programs using environmental ledgers for households.
• Steelmakers started education programs that included all
employees, including at group companies, promotion of use ofhousehold environmental ledgers, and other actions. There were
23,000 households participating in this program in FY2011.

Households Using Environmental Ledgers(Family（世帯数）unit)
25,00021,597

21,493

21,55922,67220,000• In the steel industry, to reduce CO2 emissions at offices,companies have been aiming for the goal of “reducing 20082012 average emissions by 5% in relation to 2003-2005 average
emissions.”• In FY11, steel industry office CO2 emissions and energy
consumption were both below the reference years.

(K tons(千t-CO2)
of CO2)40.0

CO2 Emissions at Offices
31.2

30.0

26.1

15,00020.0
10,000
5,769

10.0

5,000
0

250
2006

2007

2008

2009

2010

2011

Household CO2 Emissions(kg-CO2)(CO2 emissions per individual: kg of CO2/person-year)

2,500
2,000

1,990

ガソリン
Gasoline

電力等
Electricity

1,941

1,843

523
1,500

924

901

1,000

0

TOTAL
全国計
(FY2010)（2010年度）

Reference
基準年 Year

FY2011
2011年度Energy Consumption at Offices

(TJ)

800.0
700.0

686.0

600.0

518.2

500.0
400.0
300.0

1,467
500

0.0

1,017

942

Steel makers
鉄鋼業(FY2010)

Steel makers
鉄鋼業(FY2011)（2010年度）（2011年度）

Source: Estimates based on Greenhouse Gas Inventory Office materials
Notes:
1.Total for Japanese households includes households and household use of automobiles.
2. Total for steel industry households is an estimate by JISF based on the inventory in Japan

200.0
100.0
0.0

Reference
基準年Year

FY2011
2011年度Note: Data for 318 business sites of 77 companies. In principle, FY03-FY05
average is used, but FY04-FY05 average is used in cases where officedata was difficult to obtain16

2. The Goals and Vision of Japan’s Steel Industry

Implementation of Plan to Achieve a Low-Carbon Society

17

The Goals and Vision of Japan’s Steel Industry

The Goals and Vision of Japan’s Steel Industry• Under the current voluntary action program, the Japanese steel industry is implementing three “eco” initiatives: energy conservation in steel
industry production processes (eco processes); lowering global CO2 emissions by transferring and increasing the use of energy-conservation
technologies (eco solutions); and using high-performance steel to lower CO2 emissions of products using steel (eco products). In addition, thesteel industry has started work on developing revolutionary technologies for steelmaking processes (COURSE50) to achieve a medium tolong-term reduction in CO2 emissions.
• Starting in 2013, the steel industry will continue to use the three “eco” initiatives along with COURSE50 to make steady progress in combating
global warming under the plan to achieve a low-carbon society.

Eco Process2020←2013

Aiming for a further improvement in the energy efficiency of the Japanese steel industry’s steel production
processes, which are already the highest in the world (Reduction of 5 million tons vs. business as usual in 2020)

Eco Solution

The Japanese steel industry will contribute to lowering global emissions by transferring its world-leading energyconservation technologies associated with eco processes to other countries (mainly developing countries) andincreasing the use of these technologies. (Estimated emission reduction contribution of about 70 million tons in
2020)

Eco Product2050←

By supplying the high-performance steel that is essential to create a low-carbon society, contribute to lowering
emissions when finished products using this steel are used (Estimated emission reduction contribution of about
33 million tons from major types of high-performance steel)Development of revolutionary steelmaking processes (COURSE50)

Cut CO2 emissions from production processes about 30% by using hydrogen for iron ore reduction and collecting
CO2 from blast furnace gas. The first production unit is to begin operations by about 2030*. Goal is widespreaduse of these processes by about 2050 in line with timing of updates of existing blast furnace facilities.
*Assumes establishment of economic basis for CO2 storage infrastructure and creation of a practical unit using these processes.

18

Eco Process

The Goals and Vision of Japan’s Steel Industry• According to the IEA, Japan has world’s smallest potential for energy conservation per ton of crude steel. According to RITE,
Japan has the world’s most energy efficiency steel industry. These figures demonstrate that virtually all steel mills in Japanuse existing technologies and that there is very little potential for further energy-conservation measures.
• Looking ahead to 2020, the Japanese steel industry will be first in the world to begin using relatively new advanced energyconservation technologies where utilization can still be increased. One example is the next-generation coke oven. This wasdeveloped in Japan and there is currently only one in the world (at the Oita Works of Nippon Steel & Sumitomo Metal). The
goal is to cut CO2 emissions by 5 million tons compared with anticipated emissions for each production volume through the
maximum use of the most advanced technologies. Achieving this will further increase Japan’s world-leading energy efficiency.
• This target incorporates the greatest possible reduction potential and does not take into account the advanced level of thetechnologies or technological and physical limitations for the use of these technologies.

Steel finishing

8.4
7.6

5

EJ/year

6.4
4

Japan’s energy
conservation potential
per ton of crude steel isthe smallest in the world.

Comparison of Steel Industry Energy Efficiency (2010)9Japan has the world’s highest
energy efficiency.

Power generation from BF gas
Switch from OHF to BOF
BOF gas recovery

6

Blast furnace
COG recovery

3

3.9

4.4

3.1

3.8

CDQ

3.5

Specific savings potential(GJ/t steel)

2

3

2.3
1.6

1

1.4

1.0

1.0

Japan

Other

0

0
World

China Ukraine India

BrazilRussia

GJ/t steel

6

Energy Consumption Reduction Potential from Transferringand Promoting Energy Conservation Technologies (2009)

South Canada OECD United
AfricaEurope States

Korea

JPN

KOR

DEU

CHN

FRA

GBR

IND

BRA USA

RUS

Source: RITE “Estimated Energy Unit Consumption in 2010” (converted to an index by JISF)

Source: IEA “Energy Technology Perspective 2012”

Small potential for further energy conservation by using existing technologies

Maximum use of highly advanced energy-conservation technologies = 5 million ton reduction

19

The Goals and Vision of Japan’s Steel Industry

Eco Process: 2020 Goal
• The goal of cutting CO2 emissions by 5 million tons compared with anticipated emissions for each production volume through the
maximum use of the most advanced technologies is the same as the technological reduction potential of 5 million tons, in principle
irrespective of changes in production volume (except in the case of a large change in production volume).
• Specifically, the goal is to cut emissions by 5 million tons by using advanced technologies that have reached the stage of practical use
when current facilities are updated or replaced. Examples include the use of next-generation coke production technology, higher
efficiency for joint thermal and internal power generation, more energy-conserving equipment like TRT, CDQ and facilities to recoverheat emissions and sensible heat, higher efficiency for equipment powered by electricity, and more chemical recycling of waste plastics
and other materials at steel mills.
• When starting to use new technologies, in addition to initiatives of the steel industry itself, specific emission-reduction measures(promotion of widespread use, actions to recover and utilize waste plastics and other materials, and other measures) using thecooperation of the public sector and others will be vital as well.
• Furthermore, since the post-Kyoto Protocol international framework and system in Japan have not been determined, no one knows what
type of measures to ensure compliance will be established. But from the standpoint of ensuring the plan’s reliability, a suitable method
will be used in the event of a shortfall.

Emission Reduction Targets for 2020
For lower production(10 million tons less than standard case)(Million tons, Million tons of CO2)
For higher production(10 million tons above standard case)Standard caseTotal crude steel production in Japan109.66

119.66129.66

Production at participating companies

105.16114.75124.34

BAU emissions at participating companies

183.31

195.40207.51

190.40202.51

Reduction from new technologies
Total reduction at participating companies

5
178.31*Production volume at participating companies is calculated by using the ratio of FY2005 crude steel production at companies participating in thevoluntary action program to total crude steel production in Japan (95.9%).
*A significant change in production volume may cause these figures to become greater or less than the anticipated range. If this happens, the suitability of
the BAU and emission reduction volumes will have to be reexamined based on actual production volume.

20

The Goals and Vision of Japan’s Steel Industry

Eco Process (Revolutionary steelmaking technologies)(Reference: Advisory Committee on Energy and Natural Resources report)

About 5 million tons of CO2
About ¥1 trillion

Premise for long-term energy supply-demand outlook (recalculated) (proposal)

Maximum use of advanced technologies at practical stages when facilities are updated or replaced

Ironmaking

Major technologies envisioned
420,000kL○ Increase chemical recycling using waste plastics at steel mills

470,000kL○ Improve efficiency of equipment powered by electricity

120,000kL○ Increase the use of energy-conservation equipment

510,000kL

Replace internal and joint thermal
power generation facilities with more
efficient equipment

Install more efficient equipment when existing
facilities are due for replacement to create theoptimum composition of equipment in the future

Use less coal by utilizing waste plastics and othermaterials collected in accordance with Japan’scontainer recycling law.

Collect and use 1 million tons ofwaste plastics and other materials

Replace electrically powered equipment at steel mills with more efficient facilities.
Install more facilities for utilizing waste heat, such as
blast furnace top equivalent pressure gas recovery
and coke oven sensible heat recovery.

○ SCOPE21 coke ovenConserve energy when producing cokeby using preliminary coal processing
and other measures.

When updating or replacing
equipment, raise efficiency to thehighest possible level.

310,000kL

Start using new technologies at all coke ovens
as they are updated or replaced (six ovens by2020).

Major associated initiatives thus far
Development of a revolutionary coke production technology (SCOPE21) thatconserves energy and produces coke very efficiently(FY1994-FY2003: ¥8.2 billion)

Global Steel Demand（億㌧）
100mil.
tons

1.3bil. tons

5-7% pa 13億㌧
年５～７％

15

粗 鋼見掛消費○ Higher efficiency for internal and joint thermal power
generation equipment

Rapid increase in global steel demand due mainly to higher demand indeveloping countries

Apparent crude steel consumption

In Japan’s steel industry, which is already the world’s most efficient, cut
CO2 emissions by using the following types of advanced technologies.

800mn
8億㌧
tons

1% pa, up 年１％、30年間で＋１億㌧
100mn tons in 30 years

10

7億㌧tons5%
pa 700mn
年５％

5

0

64

67

70

73

76

79

82

85

88

91

94

97

00

Source: world steel

03

06

Japan’s steel industry has the world’s highest energy efficiency. As global
steel demand rises, lowering Japan’s production while raising production inother countries would thus cause worldwide CO2 emissions to increase.
Steel Industry Unit-Energy Consumption (Blast furnace-steel converter)

Issues○ Issues involving users of advanced technologies• Limited space for new equipment• Compatibility with current infrastructure (energy supplies, etc.)• Restrictions on timing of installation work (need to reflect production plans,
limitations on lost output during installation)○ Issues involving providers of advanced technologies• Ability of manufacturers to supply technologies (technology development,
design and production capabilities)• Engineering capabilities○ Other restrictions• Limitations on the ability to collect and supply waste plastics and othermaterials*These materials are based on assumptions that use model calculations.

JPN

KOR DEU FRA GBR USA CAN CHN IND AUS RUS

Source: RITE “International Comparison of Energy Efficiency (Electric Power, Steel and Cement)”

21

The Goals and Vision of Japan’s Steel Industry

Eco Solution• According to steel industry analysis using the most recent data by both the IEA and RITE, the Japanese steel industry is the most energy
efficient in the world.
• According to the IEA, if energy-conservation technologies (including efficient blast furnaces, etc.) were used worldwide, the potential
reduction in global CO2 emissions is about 400 million tons per year (equivalent to 30% of Japan’s total CO2 emissions).
• Major energy-conserving technologies developed and applied by the Japanese steel industry have been transferred to other countries byJapanese companies. Looking only at coke dry quenching (CDQ), top pressure recovery turbines (TRT) and other major facilities, thesetechnologies have cut annual CO2 emissions by about 43 million tons collectively in China, Korea, India, Russia, Ukraine, Brazil and othercountries.
• Based on the potential for lowering global CO2 emissions through major energy-conserving technologies, the current share (of CO2
emissions) of Japanese companies, their supply capacities and other factors, Japan's contribution for lowering annual CO2 emissions
globally in 2020 is estimated at 70mn tons .
Estimates of potential reductions resulting from use/transfer of the
major technologies (2009)
8.4

Potential global
reduction is 400
million tons of
CO2 per year

7.6
5

EJ/year

6.4
4

9

Steel finishing
Power generation from BF gas
Switch from OHF to BOF
BOF gas recovery

6

Blast furnace
COG recovery

3

3.9

4.4

3.1

3.8

CDQ

3.5

Specific savings potential(GJ/t steel)

2

3

2.3
1.6

1

1.4

1.0

1.0

Japan

Other

0
China Ukraine India

BrazilRussiaSource: IEA “Energy Technology Perspective 2012”

South Canada OECD United Korea
AfricaEurope States

Comparison of Steel Industry Energy Efficiency (2010)

Coke dry quenching (CDQ)
Top-pressure recovery turbines (TRT)
Byproduct gas combustion (GTCC)
Basic oxygen furnace OG gas recovery
Basic oxygen furnace sensible heat recovery
Sintering exhaust heat recovery

71
51
27
21
7
6
Total emission reduction

Reduction(10,000 tons/year)
1,205
897
1,274
792
85
88
4,341

CDQ：Ｃoke Dry Quenching
ＴＲＴ：Top Pressure Recovery Turbines
ＧＴＣＣ：Gas Turbine Combined Cycle system
0

World

No. of units

GJ/t steel

6

Emission Reductions in Other Countries from Japanese Energyconserving Equipment

Potential CO2 emission reduction
400 million tons/year world wide
Japan’s contribution by transferring major energyconserving technologies

FY2011: 43million tons

JPN

KOR DEU CHN FRA GBR IND

Source: RITE “Estimation of Energy Unit in 2010” (Indexed by JISF)

BRA USA RUS

FY2020: 70million tons

22

The Goals and Vision of Japan’s Steel Industry

Example of an Eco Solution(Use of coke dry quenching (CDQ) in China)• The use of a Japanese CDQ started in the 1990s as a NEDO energy conservation model project.
• Recognizing the ability of CDQ to conserve energy, the government of China started to use CDQ under its 10th five-year plan,
which started in 2001.
• JV with a Japanese engineering company was established in China. The JV and the associated decline in the cost caused CDQ
use to increase at an accelerating pace since in the mid 2000s. In addition, Chinese company accomplished domestic production.

Cumulative CDQ facilities in use• Achieving the widespread use of CDQ in China is an excellent example of how making a technology from Japan a standard
technology can lead to rapid growth in the use of the technology.

Reasons for the accelerating pace of growth in
CDQ use in China• Completion of NEDO energy conservation model
project (FY2000)• Chinese gov’t measures to use CDQ (since 2001)• Low-cost CDQ due to JV in China (since 2003)

Chinese gov’t measures to start using
CDQ (began with 10th five-year plan)

Chinese gov’t recognizes
the benefits of CDQ(Water / Electricity)

China: 50 units
Other foreign countries: 22 units
Japan: 24 units(Total of 96 units)

Cumulative CDQ
use in JapanIn 1973, Nippon Steelpurchased a CDQ license fromthe former Soviet Union

Technological improvements(169 patents: larger, more
efficient, etc.)

Established joint venture
in China (Nippon Steel andShougang Group)

NEDO energy conservation model
project (Shougang Group CDQ)

23

Eco Solutions –Encouragement of International Alliances I

The Goals and Vision of Japan’s Steel Industry• The Japanese steel industry has achieved concrete results by using the Japan-China Steel Industries Conference on Exchange ofAdvanced Technologies on Environmental Preservation and Energy-Saving, World Steel Association (60 countries) and other forums toencourage adoption of the global sectoral approach.
• The Japanese steel industry is making a significant contribution by transferring the industry’s outstanding energy-conserving technologies
and equipment to other countries and increasing their use in these countries.
1.Japan-China Steel Industries Conference on Exchange of Advanced
Technologies on Environmental Preservation and Energy-Saving• Japanese and Chinese executives signed a memorandum of
understanding at the first meeting that was held in July 2005 in
Beijing. Since then, technology exchange conferences
attended by experts from the two countries have been held
every year.
• The foundation for international cooperation in the steel
industry• The seventh conference is to be held in Laiwu during FY2012.
Date

Location

1st

July 4-5, 200

Beijing

2nd

November 1-2, 2006

Beppu (Oita)

3rd

September 26-28, 2007

Beijing

4th

March 12-13, 2009

Makuhari (Chiba)

5thApril 27-28, 2010

Anshan6th

November 9-10, 2011

Kobe

7th

To be decided

Laiwu

2. International cooperation using the World Steel Association• The World Steel Association is working on a global scale on measures in the steel
industry to conserve energy and combat global warming.
• The CO2 Breakthrough Programme was started in 2003 with the goal of developing
breakthrough technologies for substantial CO2 emission reductions. Japan isparticipating in this initiative through COURSE50, an initiative to develop innovativetechnologies for steelmaking processes that lower CO2 emissions.
• In April 2008, the World Steel Association started the Global CO2 Emissions Data
Collection Programme. The association’s own methods for calculating CO2 emission
volumes and unit-emissions were developed and CO2 emission data at the world’s
major steel mills are being gathered and reported.

1. International standard (ISO 14404) Calculation method of carbon dioxide emissions
intensity from iron and steel production• In November 2008, the Japanese Ministry of Economy, Trade and Industry proposed
making a measurement method for industrial energy efficiency (unit CO2 emissions)an international standard.
An approach using individual industrial sectors is effective at achieving greenhousegas emission reductions in a manner that is fair and viable. To reflect this approachin the next framework, international agreement for a sectoral energy efficiency (unitCO2 emissions) measurement method is vital. Establishing an international standard
is an effective way to accomplish this.
• In response to this statement, the Japanese steel industry formed a working group at
the JISF that began working in 2009 on an international standard for calculation
method of CO2 emissions intensity from iron and steel production based on thecalculation method developed by the World Steel Association. Voting is now underway (November 28, 2012 to January 28, 2013) on the Final Draft International
Standard. The goal is to issue this standard by the end of FY2012.

Highlights of ISO 14404

Has two parts: Part 1 for steel mills with blast furnaces and part 2 for steel mills
with electric arc furnaces
Provides common boundary concept and default conversion factors
Provides up-stream concept: compensates the difference in site configuration oniron and steel making process
Optional conversion factor allowed if credible

24

The Goals and Vision of Japan’s Steel Industry

Eco Solutions –Encouragement of International Alliances II

The Japanese steel industry is encouraging adoption of the global sectoral approach on Asia-Pacific Partnership and GSEP (Global
Superior Energy Performance Partnership) in close cooperation between public and private.
1. APP Steel Task Force

2. GSEP Steel Working GroupThis task force was started in April 2006 by the ministers of six countries:
Japan, Australia, China, India, Korea and the U.S. (Canada joined in 2007),
raising participation to the current seven countries. Meetings are held twice
each year and were consistently producing benefits until GSEP took over in2010.
There are eight task forces, including for steel and cement, and Japan chairs
the steel task force.
Member countries have given the steel task force high marks for facilitating
the sharing of energy-conservation technologies, establishing a uniform
system for measuring efficiency, performing energy-conservation diagnoses
using specialists, and performing other activities.

• At the July 2010 Clean Energy Ministerial, the decision was made to terminate APP to form a
new international organization called GSEP, a proposal by Japan and the U.S. for improving
energy efficiency. With public and private-sector participation, GSEP is moving forward with
six working groups, including a steel working group.
• Under the leadership of Japan, the steel working group is involved in increasing the use ofclean technologies in member countries and activities for energy security, economic progressand environmental protection.
• The conference will be held once each year, as a rule. The first conference held in Tokyo
March 2012.

Structure of GSEP
SOACT Handbook

The Clean Energy
Ministerial (CEM)• The State-of-the-Art Clean Technologies(SOACT) for Steelmaking Handbook
contains 22 environmental-protection
technologies and 42 energy-conservation
technologies. Of these technologies, 27
are provided by Japan.
• All technologies are posted on a website
and are available to the public.

Other
CEM
initiatives

The Five Objectives of the
GSEP Steel Working GroupThe International Partnershipfor Energy Efficiency
Cooperation (IPEEC)

Global Superior
Energy Performance
Partnership (GSEP)Other
IPEEC task
groupsSteel Mill Diagnostic Surveys• Engineers performed energy-conservation diagnostic surveys at three steel mills in
China and three steel mills in India between fiscal 2007 and 2009.
• These surveys showed that the potential CO2 emission reductions at the six steel
mills total about 6 million tons.
Tata Steel Ltd.
(Jamshedpur)1) Taiyuan(太原)：JFE Steel, JISF
2) Jinan(済南)：Nippon Steel, Kobe
Steel, JISF
3) Jiangyin(江陰)：Sumitomo Metals,
JISF★ Schedule： December 2007
★ 3 ~ 4 Experts (fromJapan) at
each site★ Follow-Up Meeting： November
2008

Taiyuan●Jinan●SAIL(Rourkela)

Jiangyin●Rashtriya Ispat Nigam Ltd.
(Visakhapatnam)

Energymanagement
WG

Steel
WG

Cement
WG

Electric
power
WG

Cool roof
pavement
WG

CHP/
DHC
WG

1.Develop and implement energy
management framework which canbe used in the wide range of steel
plants.
2.Develop and implement
techniques to utilize, update andverify performance indicators. .
3.Identify and disseminate existing
and breakthrough technologies
to reduce energy usage, andconsequential reduction in CO2emissions from steel production.
4.Disseminate information on
reducing environmental burden
and increasing recycling in steel
industry.
5.Share and exchange information
on policy frameworks for the
steel industry and financial
mechanisms for technology
deployment

Eco Solutions –Encouragement of International Alliances II

The Goals and Vision of Japan’s Steel Industry• The Japanese government is proposing the bilateral offset mechanism as a means of reducing and absorbing global CO2
emissions. The mechanism aims to establish a framework for technology transfers and actions that respond with flexibility andspeed to conditions in developing countries.
• This mechanism is consistent with the international cooperation activities of the Japanese steel industry. It is also an effective
method for evaluating and promoting international contributions from transferring and utilizing Japan’s energy-conservation
technologies. As a result, the Japanese steel industry as well cooperating in many ways with the Japanese government.
1. Bilateral Offset Mechanism• This mechanism uses bilateral agreements for the flexible
and rapid assessments and recognition of contributions
to overseas CO2 emission reductions from Japan’s lowcarbon technologies. The reductions are then certified as
emission reductions for Japan.
• There are three GS under way in FY2012.
Offset Mechanism Flowchart
2. Bilateral Offset
Mechanism
Partner
Bilateral agreementsJapan
countries

Used to achieve
Japan’s emission
reduction target

Offset• As a result of discussion among The Japanese Ministry of Economy, Tradeand Industry (METI) and JISF and the Indian Ministry of External Affairs andMinistry of Environment and Forests, this meeting is focusing on technologicalissue for development the list that are truly suitable for India’s steel industry.
• The first conference was held in November 2011. The next conference was in
New Delhi in November 2012 and the following meeting is to take place inTokyo in early February 2013.
• These activities are included in the joint statement of the 5th and 6th JapanIndia Energy Policy Dialogue (an initiative of METI and the India National
Planning Commission).

Joint projects

Low-carbon technologies/products(Applicable technologies, MRV, themethod for determining credits and otheritems will be determined by Japan andpartner countries)

2. The public and private collaborative meting between Indian andJapanese iron and steel industry

Greenhouse gases
Reduce/Absorb

Steel Industry Bilateral Offset Mechanism FS in FY2012
Steel Industry (India)
Study concerning policy advice for increasing the use of energyconservation technologies in the steel industry of India (see “2. JapanIndia Private-Public Sector Steel Cooperation Conference” for more
information)

Full list
List covering all major
steel-related energyconservation andenvironmental
recycling technologies
in the world(136 technologies)

Japan-India PrivatePublic Sector Steel
Cooperation Meetinge

Use Japan’s experience
to customize technologies
to match thecharacteristics of the
India’s steel industry

Technologies
customized List
List of energyconservation technologies
that truly match the needsof India’s steel industry(Currently, 17technologies have been
selected)

JFE (India)
Study for energy conservation project at JSW steel millJFE (Vietnam)
Study for policy advice and commercial feasibility concerning CO2
emission reduction in the Vietnamese steel industry by using energyconservation technologies of the Japanese steel industry

26

The Goals and Vision of Japan’s Steel Industry

Eco Product•Japanese manufacturers have taken the lead in developing and commercializing many highly efficientindustrial products. Examples include fuel-efficient automobiles and highly efficient power generationequipment and transformers. These products have made a big contribution to conserving energy andcutting CO2 emissions in Japan and worldwide.

•

The Japanese steel industry has established a close relationship with these manufacturers by developing
and supplying steel that has a variety of characteristics. This high-performance steel is a vital to achieving
the outstanding functions of advanced products and has earned a reputation for reliability among
manufacturers.

•

Steel from other countries cannot match Japan’s high-performance steel in terms of performance, quality,
supply and other attributes. This steel is the core element of the international competitive edge of theJapanese steel industry. In recent years, overseas demand has been strong for high-performance. The
main reason is economic growth and industrial progress in China and other Asian countries. Japan’s steel
exports have been climbing as a result.

•

Most high-performance steel is an eco product that helps make products more energy efficient, thereby
lowering CO2 emissions. Supplying this steel enables Japan to make a big contribution on a global scale
to conserving energy and cutting CO2 emissions. Furthermore, by meeting demand worldwide, this steel
helps drive “green” growth in Japan that underpins the Japanese economy and creates jobs.

•

More growth is foreseen in the need for high-performance steel. To meet this demand, the Japanese steel
industry will continue to supply this steel and develop more technologies. These activities will enable steel
eco products to continue to contribute to economic growth in Japan and to improving the global
environment.

27

The Goals and Vision of Japan’s Steel Industry

The Competitive Edge of Eco Product in Global Markets• Global crude steel production has increased rapidly since 2000 and is expected to continue to grow.
• In the Japanese steel industry, external demand (direct and indirect exports) has grown to account for almost 60% of total
demand.
• The main reason is the ability of Japanese steelmakers to use the international competitiveness of eco products to target
overseas demand for steel, chiefly in Asia. Japan is the only country that is a net exporter of steel to China, the world’s
largest steel producer. This is proof of Japan’s international competitive edge.
Global crude steel output has increased rapidly
since 2000 and more growth is foreseen.

China, the world’s largest steel producer, became a net exporterin 2006 but imports from Japan still exceed exports.
(10,000 tons)

2000

2010

~0.9bn tons

~1.4bn tons

2050
(Forecast)~2.7bn tons (IEA)

With Japan

Steel Trade of China (Total)

ImportExport~2.2bn tons (RITE)
Excess import

External demand has increased to almost 60% of
total demand for steel made in Japan.

Excess export from 2005

With Korea

Source: worldsteel

Japan’s Crude Steel Production by Demand CategoryNet
exportIndirectexportNet domestic demand

Excess import
Total(Million tons)

Excess import

ImportExcess export from 2005

ExportJapan’s rising share of China’s steel imports
2010

2005

Japan
24%
Others76%
Source: JISF

Source: China Customs statistics

Japanese share grewalmost double in 5 years

Others
53%

Japan
47%

28

The Goals and Vision of Japan’s Steel Industry
Eco Product Contribution I: Quantitative Evaluations – Contributions of Major High-performance Steel Products•••

To establish a method to determine the quantitative contribution of high-performance steel, JISF established in FY2001 a committee with theparticipation of associations of steel-consuming industries, The Institute of Energy Economics, Japan and the Japanese government. The
committee has been monitoring contributions every year since then.
Statistics are for the five major types of high-performance steel for which quantitative data are available (FY2011 production of 9.14 million
tons, 8.6% of Japan’s total crude steel output). The use of finished products made of high-performance steel cut FY2011 CO2 emissions by
9.26 million tons for steel used in Japan and 12,82 million tons for exported steel, a total of 22.08 million tons of CO2.
In FY2020, the CO2 reduction from the use of finished products made of these steel products will be an estimated 9.83 million tons for steel
used in Japan and 23.62 million tons for exports, a total of about 33.45 million tons of CO2.

1. Domestic

CO2 Emission Reductions FY20 (E)CO2 Emission Reductions FY11

Transformers
変圧 器

Transformers
変 圧 器

170

171

221

2. Export
Power発電用ボイラー
generation boilers

Transformers
変 圧 器

41
198
Ships
船舶

542

CO2 emission
CO2削減量
reductionof
12.82 million
1,282万t-CO2
tons

Reduction by
9.14 million tonsof the five major
types of highperformance
steel

502

Automobiles
自動車

３３４５万トン

481
Automobiles
自動車

33.45 million tons

81

Ships
船舶

２２０８万トンTrains電車

CO2
emission
reduction
CO2削減量of 9.26926万t-CO2
milliontons

22.08 million tons

23

Trains

電車

30

262

CO2
emission
CO2削減量
reduction of
983万t-CO2
9.83 million
tons

368

Ships
船舶

102

Automobiles
自動車

Power
generation boilers
発電用ボイラー

92

変圧 器
Transformers

562

857

CO2 emission
CO2削減量
reductionof
23.62 million
2,362万t-CO2
tons

Ships
船舶

Automobiles
自動車

851

Power generation boilers

発電用ボイラーPower generation boilers
Source: The Institute of Energy Economics, Japan
発電用ボイラー*The five categories are automotive sheets, oriented electrical sheets, heavy plates for shipbuilding, boiler tubes and stainless steel sheets. In FY2011, use of the five categories of steel products in Japan was 4.39 million tons and exports were 4.75 million tons fora total of 9.14 million tons.
*Assessments in Japan started in FY1990 and for exports assessments started in FY2003 for automobiles and shipbuilding, in FY1998 for boiler tubes, and in FY1996 for electrical sheets.
*The estimate for the FY2020 emission reduction assumes that high-performance steel output will increase starting in FY2011 at the same rate as crude steel output and that demand for the five categories of high-performance steel will increase. (EstimatedFY2020 crude steel output is about 120 million tons based on the macro framework of the METI Fundamental Policies Committee.)
For electric power generation boilers in Japan, the estimate is based on the coal power generation development plan to 2020 in materials of the Fundamental Policies Committee.

29

The Goals and Vision of Japan’s Steel Industry
Eco Product Contribution II: Estimated Contributions of Energy-conservation and Renewable Energy Measures
•

•
•

(1)

In addition to the Contributions of Major High-performance Steel Products on the previous page, the FY2020 contribution of high-performancesteel was estimated for the energy-conservation and renewable energy measures proposed by the Energy and Environment Conference and
METI Fundamental Policies Committee during the phase of studying revolutionary energy and environmental strategies.
High-performance steel with the functions shown in the table below is essential for using the energy-conservation and renewable energy
measures presented by the conference and committee.
The contribution of this steel is calculated by converting these two measures into CO2 emission reductions and assuming that one-fourthcomes from high-performance steel results in emission reduction contributions of 3.81 million tons for energy-conservation measures and7.61 million tons from renewable energy, a total of 11.42 million tons.

Energy conservation *1

CO2 emission reduction(10,000 tons)

High-performance steel used

Contributing function

Due to steel*3

Total

Industrial motors

32

8

Oriented electrical sheets

Outstanding electromagnetic properties

High-efficiency boilers

254

64

Seamless high-chrome tubes

Resists high temperatures and corrosion

Energy-efficient transformers

62

Oriented electrical sheets

Hybrid construction machinery

29

7

Oriented electrical sheets

Next-generation automobiles

1200

300

Oriented electrical sheets

Total

1521

381

(2)

Use of renewable energy*2

CO2 emission reduction(10,000 tons)

High-performance steel used

Outstanding electromagnetic properties

Contributing function

Due to steel*3

Total

Small/midsize hydroelectric
power

1789

447

Abrasion-resistant steel
bearings

Wind power

307

77

Heavy plates for easy welding
Oriented electrical sheets

Geothermal power

205

51

Corrosion-resistant pipes

Biomass power generation

746

186

Corrosion-resistant pipes

Total

3047

761

Outstanding durability
High strength, ease of welding
Outstanding electromagnetic properties
Resistance to corrosion*1 The CO2 reduction benefit from energy-conservation is an estimate of The Institute of Energy Economics, Japan based on the crude oil equivalent energy conservation in document 5 “Basic Data concerning the Proposal for
Energy Mix Options” of the 27th Fundamental Policies Committee meeting.
*2 The CO2 reduction benefit from renewable energy is an estimate of The Institute of Energy Economics, Japan using the “0.316kg-CO2/kWh” FY2010 performance of The Federation of Electric Power Companies of Japan andbased on the electricity produced by source in 2020 in the “25 Scenarios” of the “Scenario Data” on the website of the National Policy Unit.
*3 Assumes 50% benefit from technological designs and 50% from improved materials, then half (25%) from steel. For quantitative assessments, uses the method for electric power generation boiler tubes.

30

The Goals and Vision of Japan’s Steel Industry

Development of Revolutionary Technology for Steelmaking Process (COURSE50)(COURSE50：CO2 Ultimate Reduction in Steelmaking process by Innovative technology for cool Earth 50 )CO2 emissions are unavoidable when coal is used for the reduction of iron ore.
The goal is to cut total CO2 emissions by about 30% by using hydrogen to reduce iron ore andcollecting CO2 from blast furnace gas.
The first practical system is to start operating by about 2030*. All blast furnaces are to be
switched to this technology by 2050 as blast furnace facilities are updated and replaced.
*Assumes establishment of economic basis for CO2 storage infrastructure and creation of a practical unit using these processes.

Project summary
1. Total cost (Phase1, Step 1): About ¥10 billion (tentative)
2. R&D activities (technology development)a) Development of hydrogen amplification technology
using unused coke oven gas sensible heat (800ºC)b) Development of iron ore reduction technology usinghydrogenc) Collection of CO2 from blast furnace gas by using
unused exhaust heat at steel mills

NEDO Project（Phase1 Step1 2008～12)

Medium/long-term timeline

2008

09

10

11

12

1.6

2.5

2.0

2.6

1.8 (billion yen)

2010

Phase1 Step1 Phase1 Step2(2008～12） (2013～17）

2020

2030
Phase22040

Practical applications, morewidespread use

2050

3131

The Goals and Vision of Japan’s Steel Industry

COURSE50 Progress Report
Progress Overview and Upcoming Issues
FY2012 Topic 1: Operation of trialhydrogen reduction blast furnace
See explanation on the right
FY2012 Topic 2: Development ofhydrogen amplification technology*
Actual gas test using bench plant (Diagram below)

Catalytic large reactor (shown during installation)

Hydrogen reduction operation at the trial blast
furnace of LKAB in Sweden started on April 16, 2012and ended on May 11 as planned. All initially planned
test levels were achieved.
(1) A decline in input C volume (CO2 emissions)
was confirmed for tests using both the tuyere
input and shaft input. Next will be analysis of thedepth of COG permeation, blast furnace interior
reactions, etc. and confirmation of the CO2
emission reduction at an actual blast furnace.
(2) In the final year of step 1, every item for all
COURSE50 technologies will be evaluated toenable a smooth transition to step 2.
(3) During step 2, the primary activity is to develop
matching for hydrogen reduction and collecting
separated gases, primarily using the mini-trial
blast furnace, while at the same time studying
the potential for additional seeds for innovation.

1. Confirmed a twofold increase in hydrogen amplification;
test facility was a tar catalytic reforming bench plant with ascale of about 30Nm3/hour that uses actual COG.
2. Currently evaluating the durability of the reforming
properties.
* When an external supplier is used for the hydrogen needed for the hydrogen reduction of iron ore in a blast furnace, CO2 will be produced
where the hydrogen is manufactured. Therefore, hydrogen must be produced at the steel mill in order to prevent a new source of CO2. This
technology uses heat for the separation of tar from the gas in order to increase the amount of hydrogen, which is sent to the blast furnace. 32
Currently, this method can be used to reduce the amount of coke used for reduction in a blast furnace.

3. Requests Concerning Initiatives in Japan33

Requests Concerning Initiatives in JapanThe Urgent Need for an Inexpensive and Stable Supply of Electricity• In Japan, thermal power plants account for about 90% of electricity because almost all nuclear power
plants are not operating.
• If all nuclear power plants are shut down and their output is replaced with fossil fuel electricity, electricity
bills in Japan would rise by an estimated ¥3.7/kWh. Since the resulting cost would be 3.2 times more thanthe ordinary income of the EAF steelmaking industry, allowing this cost increase would be equivalent toordering this industry to cease operations.
• Due to the higher cost of fuel, Tokyo Electric Power will raise its rates in April 2013 and Kansai ElectricPower and Kyushu Electric Power have applied to raise their rates in November. Tohoku Electric Powerand Shikoku Electric Power also plan to raise their rates, indicating that the cost of electricity will rise in allareas of Japan.
• The Japanese economy is already sluggish. A rapid increase in the cost of electricity would deal a severe
blow to industrial activity and could trigger the collapse of the economy. The steel industry strongly urges
the Japanese government to quickly restart nuclear power plants, based on the premise of ensuring safety
and obtaining the understanding of nearby residents, in order to secure an inexpensive and stable supplyof electricity as soon as possible.

Impact of Higher Electricity Cost on EAF Steelmakers
Electricity
used(billion kWh)Nationwide increase of ¥3.7/kWh if all
nuclear power plants are shut down
(estimate of IEA, Japan)

Increase in cost ofelectricity(¥billion)

関連図表挿入4.7

17.4

Ordinary
income(¥billion)

5.5

Higher cost/Ordinary
income (%)

316%

Notes:
1. For all 23 EAF steelmakers in Japan
2. Unit price increases for all estimates use the estimates of The Institute of Energy Economics, Japan (estimated effect of shutting
down all nuclear power plants).
3. Ordinary income is for FY2010.
Source: Data collected by the JISF

34

Requests Concerning Initiatives in JapanThe Feed-in Tariff System Needs a Sweeping Reexamination• There are both technological and economic problems with renewable energy. For instance, the generation
cost is high and measures are needed to maintain grid stability. Furthermore, since renewable energy will
require a long-term approach, this energy cannot immediately contribute to solving the current electricity
problem.
• In fact, the current feed-in-tariff (FIT) system is a step in the opposite direction from solving the electricity
problem. Rapidly raising the amount of renewable energy use would increase the cost of fuel. This would
simply accelerate the rise in electricity rates in the form of a surcharge at a time when there are alreadyworries about the higher cost of electricity.
• The FIT system that started in Japan in July 2012 has extremely favorable terms for producers of electricity
from renewable sources. As a result, the additional cost in the first year (FY2012) is ¥0.29/kWh, which isalready 60% higher than expected. (The initial outlook was a maximum increase of ¥0.5/kWh in FY2020.)• The German FIT system also gives preferential treatment to producers of renewable energy electricity. Thishas created the problem of a high cost of electricity for the people of Germany because of the costly
surcharge. Germany is now in a situation where the purchase price must be lowered.
• Due to the current electricity situation, this same problem must not be allowed to happen in Japan, too. We
therefore ask for a prompt and comprehensive reexamination of FIT, including the upcoming price for buying
electricity.
Growth of the Renewable Energy Surcharge in Germany
Million euros

Household Electricity Bills and the Surcharge in Germany
Germany (2009)

Additional cost for renewable energy

Household electricity bill

$97/month

Household surcharge$5.40/month($14.70 in 2011)

Unit surcharge

Source: Excerpt from materials distributed at the 13th Fundamental Policies Committee meeting

1.8 cent/kWh(4.9 cents/month in 2011)35

Requests Concerning Initiatives in JapanThe Global Warming Tax Must Be Reexamined• Japan is working on post-earthquake energy and environmental policies, but there is little progress toward
establishing a basic energy plan. Even targets for measures to combat global warming have not been
determined.
• The current framework for a global warming tax and amount of taxes collected were determined before theGreat East Japan Earthquake and do not reflect the effects of this disaster.
• However, there is sufficient growth in oil and coal taxes resulting from increased thermal power generation
because of nuclear power plant shutdowns. Consequently, since Japan already has adequate revenue fromthe global warming tax, there is no need for a tax hike.
• There is an economic crisis in Japan. With electric utilities announcing plans to boost their rates, a higher
cost of energy would undoubtedly weigh heavily on any recovery in the economy.
• Once Japan makes progress toward establishing an energy policy and measures to combat global warming,
the country should once again think about whether or not a tax to combat global warming should be
imposed and reexamine this tax system.

Global Warming Tax Collections

Oil and Coal Tax Associated with Nuclear
Power Plant Shutdowns (excluding surcharge)
Estimated Natural Increase in FY2012(added to the oil and coal tax)

FY2013: About ¥80 billion
Revenues were ¥39.1 billion in the first year (FY2012), a
six-month period that started in October.

FuelPower generated*1

Tax revenues*2

Coal

15.3bn kWh~¥3.7bn

LNG

123.1bn kWh~¥20.2bn

Oil

120.9bn kWh~¥57.8bn

Total

259.3bn kWh~¥81.7bn*1 Electricity generated for each energy source according to the Japanese
government Electricity Supply and Demand Investigation Committee*2 Estimates based on generating efficiency for each energy source and unit
calorific value of each type of fuel36Requests Concerning Initiatives in JapanThe Urgent Need to Reexamine the “Innovative Strategy for Energy and theEnvironment”• Japan’s Innovative Strategy for Energy and the Environment was approved on September 14, 2012. The
strategy is based on unrealistic assumptions about the nuclear power ratio, energy-conservation measuresand the use of renewable energy sources. As a result, the strategy will have an extremely severe impact on
the Japanese economy along with jobs and the lives of the people of Japan. The government must takeanother look at these unrealistic assumptions.
• According to the scenario used when the strategy was formulated, if there is no nuclear power, electricity
rates in Japan will rise by 110% between 2010 and 2030*1. Choosing the stance of “aiming for no nuclear
power” is the same as ordering Japan’s manufacturing sector to cease operations. This is particularly true
for the EAF sector, which consumes massive amounts of electricity.
• Furthermore, Japan must have many choices for energy sources because the country has few natural
resources. Aiming for no nuclear power would be voluntarily abandoning measures to secure energy
diversity and is thus not a conceivable or viable national policy.
• In addition, the assumptions for energy conservation and renewable energy in the scenario are unrealistic.
This assumption would result in dire sacrifices for Japanese industry and the people of Japan. There is an
estimate indicating that a reexamination of the above assumptions would enable a big reduction in theimpact on electricity rates while achieving energy conservation on a par with other industrialized countries.*2• The energy and environmental policies should be thoroughly reexamined to create a realistic approach thatcan support both the Innovative Strategy for Energy and the Environment. The policies must once again
adopt the standpoint of supporting economic growth and living standards. We therefore ask for the creationof a proper energy policy along with the closely related policy for measures to combat global warming.
*1 “Summary of RITE Analysis for Energy and Environment Conference Options” of the Research Institute of Innovative Technology for the Earth (July 2012)*2 “Proposal for Alternate Options for Energy and Environmental Conference Options” of the Research Institute of Innovative Technology for the Earth (August 2012)37

Requests Concerning Initiatives in Japan(Reference) Excerpt from “Proposal for Alternate Energy Options for Energy
and Environmental Conference Options” (August 2012)

Cost of Electricity for Industrial Use (2030)
Vs. reference case

Effect of higher priceEffect of cost cutting

Carbon priceaddition

Effect of higher price(with no carbon
restriction)
Effect of cost cutting(with no carbon
restriction)

Higher pricedue todifference inenergy sourcecomposition

Cost of electricity(nominal)
Cost of electricity(nominal) (with nocarbon restriction)
No nuclear
power

No nuclear
power

Nuclear 15%

Nuclear 20%

Nuclear 25%

Nuclear 25%
modified

For industrial use as well, this study shows that the “Nuclear 25% modified” option makes possible a large reduction in
the carbon price addition. Furthermore, for the rise in the cost of electricity caused by differences in energy sourcecomposition, the “Nuclear 25% modified” has an increase of only 11% compared with an increase of 15% for the“Nuclear 25%” scenario and an increase of almost 30% for the “No nuclear power” scenarios.

38