Message from the CEO
“As the world’s most prolific material, steel can make a huge contribution to the decarbonization of the global economy. Steel is already the material of choice due to its lower carbon footprint and high recyclability. But we can and must go further as zero carbon-emissions steel has the potential to be the backbone of the buildings, infrastructure, industry and machinery, and transport systems that will enable governments, customers and investors to meet their net-zero commitments.
“ArcelorMittal has been working hard to be at the forefront of our sector in the net-zero transition, as we believe not only will this help decarbonize the global economy but will also generate opportunities in multiple aspects of our business.
“This is reflected in the new targets we have announced today. We have for the first time published a group target for 2030, alongside a more ambitious target for our European business. These targets we believe are aligned with our net zero 2050 ambition and we have also announced today a new collaboration with the Science Based Target initiative.
“These targets reflect the uneven pace of change that is the reality of the world’s decarbonization journey. In regions of the world like Europe, where we are observing an ‘Accelerate’ policy scenario, we can be more ambitious – with plans to reduce emissions by 35% within the next decade. In other markets we face a situation where being a first mover will result in us being uncompetitive in that market. For our target setting today we assume progress in other regions of the world will be at least five years behind Europe.
“With COP26 focused on addressing the acceleration that is critical in the next decade if the world is to reach its 2050 target, it may be that we will see a swifter evolution of this policy environment than is currently envisaged. Policymaking has a catalytic role to play. ArcelorMittal intends to step up our advocacy for policies that support the acceleration of this transition, addressing the fact that both capex and opex costs will be significantly higher, at least in the short to medium term.
“Ultimately the goal is to ensure that the technologies that will decarbonize the steel-making process are competitive. The good news is that we already have two technology routes - Innovative DRI and Smart Carbon - which can enable the decarbonization of the industry with a third, direct electrolysis, looking encouraging. Given our global profile we believe it is sensible to continue to develop both these technology routes which essentially encompass the clean energy routes of both green hydrogen and also bio-energy with carbon capture utilization and storage.
“In Europe our strategy is largely focused on the Innovative DRI pathway. This reflects the commitment in Europe to prioritize the availability of green hydrogen at competitive prices. Spain’s plan to accelerate the availability of renewable energy and green hydrogen underpins our recent announcement that ArcelorMittal Sestao will become the world’s first full-scale zero carbon-emissions steel plant.
“In many respects the challenges confronting steelmaking today resemble those faced by renewable energy over a decade ago. The importance of solar and wind was widely acknowledged yet the technology remained economically prohibitive. Targeted, reliable and thoughtful policies supported innovation and investment that enabled both companies and their financing partners to make long-term planning decisions.
“We are optimistic that the same will happen in steel. It is too critical a material on so many levels for that not to be the case. And as developing economies continue to grow, the world will need more steel, not less, to give a better quality of life to billions of people.
“Over this past year, we have engaged with our stakeholders on climate more than ever before. I hope this report demonstrates how seriously we take your input, how closely we have listened to your questions, and how committed we are to providing solutions.”
Aditya Mittal, CEO ArcelorMittal