Nippon Steel's Activities against climate change

Nippon Steel's current energy-conservation initiatives

Nippon Steel has been working on energy conservation from diverse starting points: improving efficient use of energy generated in the steelmaking process (i.e., power generation from recovered by-product gas and waste heat); making operational improvements in each process; renovation of older coke ovens and other equipment; introduction of high-efficiency power generation facilities and oxygen plants; and conversion to regenerative burners in the reheating furnaces.

Thanks to the achievement from these continual efforts, as well as a decline in product output mainly due to the impact of the COVID-19 pandemic, the Nippon Steel Group consumed 896 petajoules (PJ) of energy in fiscal 2020, posting a significant reduction from fiscal 2019. The Group’s energyderived emissions also dropped significantly to 76 million tons (preliminary).

Despite steady positive impacts generated from efforts for energy conservation, the CO2 emissions intensity has deteriorated mainly due to a decline in production efficiency caused by a decline in production in fiscal 2020 and the impact of heavy rain and operational troubles in fiscal 2018 and 2019, in addition to the impact of introducing energy-consuming large dust collectors and other equipment.

Nippon Steel Group's energy consumption7

Nippon Steel Group’s energy consumption

Nippon Steel Group's energy-derived CO2 emissions7

Nippon Steel Group’s energy-derived CO2 emissions

*1 PJ indicates peta-joules (1015 joules).
 A joule is a unit of energy, or amount of heat.
*2 GJ indicates giga-joules (109 joules)

[Calculation method]
Based on the Action Plans for a Low-Carbon Society

[Conversion factor]
Source: METI, Agency for Natural Resources and Energy “Table of heat generation and carbon emission coefficient by energy source” (Revised January 31, 2020)

[Boundary of data collection]
Nippon Steel4, 5, associated EAF mills (Osaka Steel, Sanyo Special Steel, Nippon Steel Stainless Steel, Oji Steel, Tokai Special Steel, Nippon Steel Structural Shapes Corporation, and Tokyo Kohtetsu), and three Sanso Center companies6

3: Preliminary figure: The amount of CO2 per unit of purchased electricity from a General Electricity Utility in fiscal 2020 is assumed to be the same amount as in fiscal 2019.
4: Excluding energy consumption and CO2 emission associated with the IPP operation by the steelworks
5: The amounts of energy consumption required for production of coke purchased by Nippon Steel and CO2 emissions are included in the aggregate.
6: Concerning the three Sanso Center companies, the amount of energy consumption required for production of oxygen purchased by Nippon Steel Group and CO2 emissions are included in the aggregate.
7: According to the change in the boundary of data collection, the amounts of energy consumption and CO2 emissions in the past years have been revised retroactively.

Breakdown of greenhouse gas (tons)

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FY2016 FY2017 FY2018 FY2019 FY2020
CO2 emissions from energy sources 95,298,497 92,978,938 93,661,572 90,261,125 73,706,256
CO2 emissions from non-energy sources 3,491,446 3,182,936 3,270,100 3,234,831 2,893,501
CH4 117,210 110,547 112,707 110,431 97,086
N2O 135,014 136,013 124,775 140,126 129,234
CO2 emissions from non-energy sources Total 3,743,670 3,429,496 3,507,582 3,485,388 3,119,821
Ratio of CO2 emissions from energy sources to GHG 96% 96% 96% 96% 96%

CO2 emissions in the value chain

CO2 emissions originated from energy source and generated in Nippon Steel’s manufacturing process (Scope 1 and Scope 2) as well as CO2 emissions in the value chain (Scope 3), which are calculated by using the Green Value Chain Platform of the Ministry of the Environment and other methods are as follows.

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CO2 emissions (thousand tons-CO2) Calculation method
2017 2018 2019 2020
Scope 1 Direct emissions from owned sources associated with use of fuel 80,501 81,09910 78,38410 62,8608 Based on the Action Plans for a Low-Carbon Society.
See the boundary of data collection stated below.
Scope 2 Indirect emissions from the generation of purchased energy 12,478 12,56310 11,87810 10,8468
Scope1+2
(Energy consumption per ton of crude steel: t–CO2/t)
92,979 93,66210 90,26110 73,7068

Scope 3 All indirect emissions (not included in scope 2) that occur in the value chain of the reporting company

①Purchased goods and services 17,494 17,28011 17,06311 14,379 Calculated using method12 below for purchased iron ore, coking coal, coke, and oxygen
②Capital goods 1,417 1,516 1,656 1,632 [Amount of capital expenditures] X [Emission factor]
③Fuel and energy related activities not included in Scope 1 or 2 422 368 305 291 [Amount of electric power procured and fuel used] X [Emission factor]
④Transportation and distribution (upstream) 756 775 683 629 [Transportation distance reported in the Energy Saving Law document] X [Emission factor]
⑤Waste generated in operations 5 5 5 4 [Amount of waste] X [Emission factor]
⑥Business travel 3 3 4 4 [Number of employees] X [Emission factor]
⑦Employee commuting 12 13 13 14 [Number of employees] X [Emission factor]
⑮Investments 848 1,231 1,208 1,125 [Emissions by subsidiaries and affiliates that emit GHG of over 10,000 tons] X [Equity stake of each company]
Crude steel production (domestic, consolidated-base, 10,000 tons) 4,829 4,850 4,589 3,663

Scope1・2

[Conversion factor]
Source: METI, Agency for Natural Resources and Energy “Table of heat generation and carbon emission coefficient by energy source” (Revised January 31, 2020)
[Boundary of data collection]
Nippon Steel9, associated EAF mills (Osaka Steel, Sanyo Special Steel, Nippon Steel Stainless Steel, Oji Steel, and Tokai Special Steel, Nippon Steel Structural Shapes Corporation, and Tokyo Kohtetsu)
8: Preliminary figure: The amount of CO2 per unit of purchased electricity from a General Electricity Utility in fiscal 2020 is assumed to be the same amount as in fiscal 2019.
9: Excluding CO2 emission associated with the IPP operation by the steelworks
10: The breakdowns of Scope 1 and Scope 2 in the past years are retrospectively revised according to the change in the boundary of data collection and improved accuracy in data calculation.

Scope3

[Source of emission factor]
The Ministry of the Environment’s emissions unit value database for accounting of greenhouse gas emissions throughout the Supply Chain (ver. 3.1) (March 2021, Ministry of the Environment)
METI, Agency for Natural Resources and Energy “Table of heat generation and carbon emission coefficient by energy source” (Revised January 31, 2020)

[Boundary of data collection] Nippon Steel
11: Past figures are retroactively revised according to the change in calculation method.
12: Iron ore and coal: [Amount purchased of procured iron ore and coal] X [Emission factor]
Coke: [Amount purchased of procured coal at source] X [Emission factor] + [Amount of energy used in production of coke] X [Emission factor by energy source]
Oxygen: [Amount of energy used in production of oxygen] X [Emission factor by energy source]

Contributing to the realization of a carbon neutral society through eco-products

In addition to promoting drastic technological innovation in the steel manufacturing process, we are contributing to the realization of a carbon neutral society by providing high-function steel products (Eco-Products) that help customers save energy and reduce CO2 emissions when using final products. Specifically, we will provide high-performance electrical steel sheets for drive motors as well as ultra-high-tensile steel plates for lighter body weight of electric vehicles, to achieve significant CO2 reduction effects when our products are used as manufactured products.

Contribution to the global value chain (Eco Solutions)

The Japanese steel industry, including Nippon Steel, contributes to reducing CO2 emissions on a global scale by transferring Japan's excellent energy- saving technology overseas. Specifically, we are promoting bilateral energy conservation and environmental international cooperation with India and countries in Southeast Asia, through three ways: public-private partnership meetings; technologies customized list; and assessment of steelworks on their status of energy saving. Since fiscal 2020 this activity has been undertaken in collaboration with the Japan International Cooperation Agency (JICA).

Noteworthy is the technology transfer for the Coke Dry Quenching (CDQ) equipment; use of this equipment has a significant effect on reducing CO2 emissions. The transfer was made by Nippon Steel Engineering Co. of the Nippon Steel Group, contributing to CO2 emission reduction of approximately 22.96 million tons globally by fiscal 2019.

Nippon Steel’s climate-change management structure

Nippon Steel recognizes climate change as one of important managerial issues. Concerning climate change, its trend, Nippon Steel’s policy, risks and opportunities, the Environmental Management Committee and the Green Transformation Development Committee meet four times or more per year in total to discussand check progress. Related important issues are reported and discussed at the Management Committee and the Board of Directors, and thus are supervised in this regard by the Board of Directors.

Adaptation to climate change

In addition to taking mitigation actions against climate change, Nippon Steel is making initiatives to prepare and adapt to potential impacts of such change. We have many products that are used for a long time as construction material for embankments and other public infrastructure. They contribute to providing solutions for “National Resilience,” such as protecting towns from flooding or high tides caused by heavy rains or typhoons. Adaptationto climate changes also leads to business opportunities for Nippon Steel. In various steelworks in Japan and overseas, water storage tanks have been installed and an administration office is built on a piloti structure, which allows to create an open space with no walls on the lowest floor and makes the building less vulnerable to tsunami. This is a part of efforts of Nippon Steel to be well prepared for emergencies such as flooding and high waves.

CO2 emission reduction by raising efficiency in logistics

Nippon Steel maintains a high modal shift rate of 96% and works on reducing CO2 emission by raising efficiency in logistics, such as by using large vessels. As part of the efforts, we are introducing new measures, including introduction of “Utashima” —a hybrid-type cargo vessel, equipped with lithium-ion batteries (awarded the Small Cargo Vessel Award of the Ship of the Year 2019 ). In addition, in cooperation with the Ministry of Land, Infrastructure, Transport and Tourism and various organizations, we are actively undertaking efforts to introduce ships utilizing new alternative fuels, such as hydrogen and ammonia, in order to reduce greenhouse gas generated by sea transport.

CO2 emission reduction by manufacturing Blast furnace cement

By using blast furnace slag for cement production, we are able to reduce the amount of lime and fuel required, and reduce CO2 emissions per ton of cement by 320 kg (more than 40% reduction compared to ordinary cement).

CO2 emissions from cement production

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2014 2015 2016 2017 2018 2019
Cement production (1,000 tons) 232 221 208 216 218 207
Cement production capacity (1,000 tons) 335 335 335 355 335 335
Clinker production (1,000 tons) 142 134 130 136 131 130
Clinker production capacity (1,000 tons) 163 163 163 142 142 140
Clinker / cement ratio 0.61 0.61 0.63 0.63 0.60 0.60
2014 2015 2016 2017 2018 2019
CO2 emissions(1,000 t-CO2) 127 122 118 122 117 117
CO2 emission per ton of cement(kg-co2/ton) 547 552 567 564 536 563

Japan Iron and Steel Federation’s action plans for a low carbon society

From fiscal 2013 on, Nippon Steel has been participating in the Action Plans for theRealization of a Low-Carbon Society for further CO2 reduction by means of the three ecos. ThePhase I of the Action Plans for a Low-Carbon Society targets a 5 million ton reduction in CO2 emissions by fiscal 2020. The Japan Iron and Steel Federation is focusing on a 3 million tonreduction in CO2 emissions at the steelmakers’ own initiatives for maximum adoption of advancedtechnologies based on its production assumption. The additional 2 million ton reduction is to be achievedby an increase in the collected volume of waste plastics compared to fiscal 2005, as the amount ofreduction in emissions.
In addition, Nippon Steel makes publicly known its views and opinions ondiverse public policies concerning global climate change through the Japan Iron and Steel Federation.

Japan Iron and Steel Federation’s Action Plans for a Low-Carbon Society
(“Three ecos and innovative technology development”)

Eco Process Eco Products Eco Solution
CO2 emission reduction plans Aim at improving energy efficiency Contribute to emission reduction when steel materials are used in final products Contribute to worldwide energy reduction by technology transfer and diffusion
FY2019 results 3.30 million t-CO2 31.94 million t-CO2 68.57 million t-CO2
Phase I FY2020 3 million t-CO2 + α1, 2 34 million t-CO2 70 million t-CO2
Phase II FY2030 9 million t-CO21 42 million t-CO2 80 million t-CO2

1: The target reductions in CO2 emission volume are set for fiscal 2005 as the base year and based on a certain crude steel production assumption.
2: The primary focus is on a 3 million ton reduction in CO2 emissions by steelmakers’ own initiatives for efficient use of energy and other ways. Concerning collection of waste plastics and other ways, only an increase in the collected volume compared to fiscal 2005 is counted as the amount of reduction in emissions.

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