It’s almost impossible to over-emphasise the importance of COP28 in terms of location, agenda, context, or timing. We have very little time to limit global warming enough to avert disaster. Indeed, over the course of yet another record year for temperatures, it appears that the one-and-a-half-degree limit has already been breached several times.
The political context is equally disturbing, with the unravelling of what we took to be a global consensus on necessary action. Former World Bank SVP Vinod Thomas was absolutely correct when he recently argued that: “It is not that most people deny the climate is changing, but views are split on its cause and the costs countries should bear to fight it… Several leaders of developed countries, responding to worries over decarbonisation costs, are now backtracking.”
So, COP28’s unenviable tasks must be to regenerate a sense of urgency and of common purpose leading to a realistic plan for immediate action.
These tasks are plainly addressed by the 12-day long programme: ‘to unite a diverse range of stakeholders … around specific solutions … to limit warming to 1.5 degrees, build resilience, and mobilise finance at scale.’
A Global Trilemma
No steel company can afford to ignore greenhouse gas emissions. The inconvenient truth is that steel production accounts for over 8 percent of global CO2 discharged annually into the atmosphere, and with demand ever on the rise, meeting that requirement without changing our ways will only make things worse. This is the ‘trilemma’ in which my industry finds itself. But solutions do exist, and things are already changing fast. For instance, the UAE’s planned $54 billion investment in growing its renewable energy capacity and Green Hydrogen technology is an example of the speed with which industrial change is occurring.
For my industry one part of the solution is to replace coke-fired blast furnaces with Electric Arc Furnaces (EAFs) that can produce steel from energy generated by low or no carbon renewables. However, with more than 1,100 blast furnaces worldwide, and a heavy cost to make the transition, it’s bound to take time, but starting is essential.
EAFs work best for reprocessing scrap but they can also be used to produce primary green steel, provided they are fed with Green Iron or Direct Reduced Iron (DRI) pellets. Producing these pellets, using a minimum of energy, requires starting with very high-quality ore, the best of which is magnetite.
Carbon Neutral , more than just hot air
This fortunate alliance of high-grade magnetite and endless renewable energy is key to hard-to-abate steel companies becoming net zero. We call it CN30, and the South Australian Government is helping us achieve this by financing the world’s largest green hydrogen electrolyser that will help us process reserves of 4 billion tonnes of high-grade magnetite in Whyalla, South Australia.
By combining locally produced green hydrogen and superior magnetite, companies will be able to produce DRI with almost zero carbon emissions. This has enormous implications for the global steel value chain, as green iron can be exported to feed low carbon steel production anywhere across the world. And what better place to turn magnetite iron ore into green iron than the UAE; a young nation bathed in constant sunshine, with easy access to deep water ports, a long-established trading history and an ambition to move away from dependence on fossil fuels? In short, all the ingredients necessary to take the Emirates into a lower carbon dioxide future and turn that future into a powerful example for other nations to follow.
For all these reasons the UAE is an inspired and timely choice to host COP 28, demonstrating just how much can be achieved, even in a nation traditionally dependent on oil. How appropriate then, if at first sight somewhat counter intuitive, to choose an oil man, Dr. Sultan Al Jaber, the CEO of the Abu Dhabi National Oil Company to also be the President of COP. Like so many of us in heavy industry, his carbon dependent background uniquely qualifies him to understand the problems inherent. He has said that “we cannot unplug the world from the current energy system before we built a new energy system” and I believe Green Iron has the potential to decarbonise global supply chains and ultimately decelerate climate change.
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