Nippon Steel's Activities against climate change

Nippon Steel Group’s efforts for energy conservation and CO2 emissions reduction

In March 2021, we announced the Nippon Steel Carbon Neutral Vision 2050, in support of the Japanese government’s ambitious policy to realize a carbon-neutral society in 2050. Through carbon neutralization, we will offer two types of value: “Provision of high-performance steel products and solutions that contribute to reducing CO2 emissions in society” and “provision of carbon neutral steel through decarbonizing steelmaking processes.” We aim to reduce CO2 emissions at the time of production and processing by our customers, at the time of use of our products by end consumers; and in the supply chain of our customers.

In addition, Nippon Steel by itself as well as the Nippon Steel Group including consolidated crude steelmaking companies that have blast furnaces and electric furnaces with high CO2 emissions have set a target for 30% reduction in CO2 emissions in 2030 compared to 2013. Also, our major domestic consolidated subsidiaries aim to be carbon neutral in 2050. Our overall Group will work together to tackle climate change issues.

Nippon Steel Group’s energy consumption and energy-derived CO2 emissions

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.

In fiscal 2020, energy consumption and energy-derived CO2 emissions decreased significantly mainly due to the impact of the COVID-19 pandemic. In fiscal 2021, as we implemented energy-saving measures while the production volume is recovering, our energy consumption and energy-derived CO2 emissions increased to 1,025 petajoules (PJ) and 87 million tons (preliminary) respectively.

Energy consumption5

nergy consumption

Energy-derived CO2 emissions5

Energy-derived CO2 emissions

[Calculation method]
Calculation for the Company and its domestic subsidiaries is based on the Carbon Neutrality Action Plan.
Overseas subsidiaries follow local regulations or guidelines for calculation.

[Conversion factor]
The Company and its domestic subsidiaries use the “Table of heat generation and carbon emission coefficient by energy source” (revised January 31, 2020) of the Agency for Natural Resources and Energy, METI.
Overseas subsidiaries use relevant emission factors according to local regulations or guidelines.

[Boundary of data collection]
Nippon Steel 2, 3, associated EAF mills (Osaka Steel, Sanyo Special Steel, Nippon Steel Stainless Steel, Oji Steel, Tokai Special Steel, Nippon Steel Structural Shapes Corporation, Tokyo Kohtetsu, Ovako, Sanyo Special Steel Manufacturing India, and Standard Steel), and three Sanso Center companies 4
The data collection period used is each company’s accounting period. As Ovako has changed its fiscal year end, Ovako’s fiscal 2021 results cover a period from January 1, 2021 to March 31, 2022 (15 months).

1 Preliminary figure: The amount of CO2 per unit of purchased electricity from each of general power companies in Japan in fiscal 2021 is assumed to be the same amount as in fiscal 2020.
2 Excluding energy consumption and CO2 emission associated with the IPP operation by the steelworks
3 The amounts of energy consumption required for production of coke purchased by Nippon Steel and CO2 emissions are included in the aggregate.
4 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.
5 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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FY2017 FY2018 FY2019 FY2020 FY2021
CO2 emissions from energy sources 93,696,013 94,186,548 90,675,141 74,021,731 83,769,887
CO2 emissions from non-energy sources 3,182,936 3,270,100 3,234,831 2,977,505 3,383,493
CH4 110,547 112,707 110,431 97,086 108,578
N2O 136,013 124,775 140,126 129,234 140,507
CO2 emissions from non-energy sources Total 3,429,496 3,507,582 3,485,388 3,203,825 3,632,578
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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Scope1 and 2

CO2 emissions (thousand tons-CO2) Calculation method
FY2013 FY2017 FY2018 FY2019 FY2020 FY2021
Scope 1 Direct emissions from owned sources associated with use of fuel 89,57810 80,72810 81,33710 78,58410 62,98710 71,292 Based on the Carbon Neutrality Action Plan.
See the boundary of data collection stated below.
Scope 2 Indirect emissions from the generation of purchased energy 13,82510 12,96810 12,85010 12,09110 11,03510 12,4788
Scope1+2
(Energy consumption per ton of crude steel: t–CO2/t)
103,40310
1.89
93,69610
1.89
94,18710
1.89
90,67510
1.93
74,02210
1.97
83,7708
1.88
Crude steel production (consolidated-base, 10,000 tons) 5,474 4,968 4,990 4,709 3,766 4,445

[Conversion factor]
The Company and its domestic subsidiaries use the “Table of heat generation and carbon emission coefficient by energy source” (revised January 31, 2020) of the Agency for Natural Resources and Energy, METI.
Overseas subsidiaries use relevant emission factors according to local rules or guidelines.

[Boundary of data collection]
Nippon Steel9 and associated EAF mills (Osaka Steel, Sanyo Special Steel, Nippon Steel Stainless Steel, Oji Steel, Tokai Special Steel, Tokyo Kohtetsu, Nippon Steel Structural Shapes Corporation, Ovako, Sanyo Special Steel Manufacturing India, and Standard Steel). The data collection period used is each company’s accounting period.
As Ovako has changed its fiscal year end, Ovako’s fiscal 2021 results cover a period from January 1, 2021 to March 31, 2022 (15 months).

8 Preliminary figure: The amount of CO2 per unit of purchased electricity from each of general power companies in Japan in fiscal 2021 is assumed to be the same amount as in fiscal 2020.
9 Excluding CO2 emission associated with the IPP operation by the steelworks.
10 The breakdown of Scope 1 and Scope 2 of the past years are according to the changed boundary of data collection and retroactively revised.

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

CO2 emissions (thousand tons-CO2) Calculation method
FY2019 FY2020 FY2021
①Purchased goods and services 17,06311 14,37911 15,994 Calculated using method12 below for purchased iron ore, coking coal, coke, and oxygen
②Capital goods 1,656 1,632 1,400 [Amount of capital expenditures] X [Emission factor]
③Fuel and energy related activities not included in Scope 1 or 2 305 291 338 [Amount of electric power procured and fuel used] X [Emission factor]
④Upstream Transportation and Distribution 683 629 710 [Transportation distance reported in the Energy Saving Law document] X [Emission factor]
⑤Waste generated in operations 5 4 5 [Amount of waste] X [Emission factor]
⑥Business travel 4 4 4 [Number of employees] X [Emission factor]
⑦Employee commuting 13 14 14 [Number of employees] X [Emission factor]
⑮Investments 1,208 1,125 1,053 [Emissions by subsidiaries and affiliates that emit GHG of over 10,000 tons] X [Equity stake of each company]

[Source of emission factor]
“Emissions unit value database for accounting of greenhouse gas emissions throughout the supply chain (ver. 3.2)” (March 2022, Ministry of the Environment)
“Table of heat generation and carbon emission coefficient by energy source” (Revised January 31, 2020; METI, Agency for Natural Resources and Energy)

[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 2021 this activity has been undertaken in collaboration with the Japan International Cooperation Agency (JICA).

The reduction effects of CO2 emission by transfer of Japanese steelmakers’ energy-saving technologies have amounted to 72.64 million ton reduction in CO2 emissions per year in total. 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 25.81 million tons globally by fiscal 2020.

Adaptation to climate change

In addition to taking mitigation actions against climate change, we take into account the diverse impact of climate change and appropriately prepare for risks, as adaptive initiatives, and at the same time seek to capture business opportunities.

Preparation for risks

There is a risk that operations and shipments may be interrupted due to the flooding of steelworks and other events, including some caused by abnormal weather as a consequence of climate change. To prevent such risks, we are implementing measures against typhoons and heavy rains, measures to prevent crane overturn, installation of levees, reinforcement of embankments and gradients, and measures to prevent wind and flood damage at each steelworks.

Moreover, our steelworks have enhanced facilities to prevent water pollution. These facilities were provided to increase waste water treatment capacity and involved installation of a large storage tank so that water tainted with iron ore powder would not directly be released into the sea even if our steelworks were subjected to localized heavy rain.

In addition, some administration offices are built on a piloti structure, which means there is open space with no walls on the ground level. This makes the buildings less vulnerable to tsunami. This is a part of our efforts to be well prepared for emergencies such as flooding and high waves.

Capturing business opportunities

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. Adaptation to climate changes also leads to business opportunities for Nippon Steel.

For example, we have developed and provided for actual use various types of products and product utilization technologies in the civil engineering field. They include hat-type sheet piles (contributing to national resilience in a wide range of ways, including measures against liquefaction of river levees, water leakage, and tsunami reaching coastal levee), linear-type steel piles (having a high-tensile strength at the joints, being suitable to cell-type quays, erosion-control dams and water shut-off work, and contributing to measures for sand embankments and against landslide at the time of heavy rain or a typhoon), and a method of preventing subsidence by use of sheet piles.

CO2 emission reduction by raising efficiency in logistics

Nippon Steel maintains a high modal shift rate of 97% 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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2015 2016 2017 2018 2019 2020
Cement production (1,000 tons) 221 208 216 218 207 199
Cement production capacity (1,000 tons) 335 335 335 355 335 335
Clinker production (1,000 tons) 134 130 136 131 130 125
Clinker production capacity (1,000 tons) 163 163 142 142 140 140
Clinker / cement ratio 0.61 0.63 0.63 0.60 0.63 0.63
2015 2016 2017 2018 2019 2020
CO2 emissions(1,000 t-CO2) 122 118 122 117 117 110
CO2 emission per ton of cement(kg-co2/ton) 552 567 564 536 563 555

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