How to accelerate shift towards green steel in Czechia?
The Czechia has committed itself to contributing to a 55% reduction in greenhouse gas emissions by 2030 and to moving towards climate neutrality in 2050. A transformation towards a low-carbon economy is inevitable for the country. At the same time, it is the only promising strategy that enables the Czech Republic to cope effectively in the future.
Climate & Company in cooperation with eclareon, the Czech Technical University in Prague and Agora Energiewende have prepared a set of specific recommendations for six sectors of the economy on how the Czechia can make better use of opportunities in the EU budget and effectively implement transformation investments and political reforms. The result is six selected so-called Flagships that represent transformative investment opportunities for climate action in the sector.
As far as the industry sector at which eclareon took a closed look is concerned, steel and metal processing are responsible for more than 5% of overall greenhouse gas and almost a quarter of total emissions in Czechia. Simultaneously, the country’s metallurgy sector, mainly concentrated in two large-scale manufacturing sites, directly employs 44,000 people and generates over €8 billion in revenues annually. ‘Bearing these figures in mind and at the same time looking at reinvestment requirements by 2030, the metallurgy sector became a no-brainer when it comes to the choice of a specific industrial flagship’, explains Dr. Boris Valach from eclareon consulting.
In order to take the first steps towards green steel, a set of policy recommendations have been proposed. First of all, Czechia should utilise its abundant domestic steel scrap reservoir using the so-called secondary route via the creation of favourable conditions promoting the closure of material flows. This is currently not the case as the country exports over half of its steel scrap, which should be cut down by tax incentives, awareness-raising instruments such as labels or product standards. Also, as the state plays an indispensable role in large infrastructure projects, almost non-existent green public procurement should be applied to a much wider extent as at present. Additionally, significantly more renewables compared to the current national targets should be deployed in the coming years because the secondary route must be complemented by the primary „full decarbonisation possible” one. Last but not least, the sector has been desperately missing impact studies and transformation plans, which are particularly needed due to long investment cycles, and should be therefore drafted.
‘In Czechia, national authorities have already been grappling with the issue of the identification of at least some metallurgy green transformation pathway, not speaking of setting concrete SMART objectives. In this regard, we could call the country’s iron and steel industry not just hard-to-abate, but rather hard-to-debate’, concludes and warns before possible carbon lock-in after 2030 Boris Valach.
For the overall project results please use this link.