September 18, 2019

Severstal pilots the World Steel Association’s programme to reduce greenhouse gas emissions by the global steel industry

PAO Severstal, one of the world’s leading vertically integrated steel and mining companies, has launched a pilot project under the World Steel Association’s (“Worldsteel”) “Step up” programme, which aims to reduce greenhouse gas (GHG) emissions by the global steel industry through the introduction of a new methodology. Launched at Severstal’s flagship steel mill in Cherepovets, a study has begun using the Worldsteel benchmarking system to identify opportunities to reduce CO2 emissions from steel production in the near term.

Based on the results of the pilot project, Severstal will be able to announce new GHG reduction targets for 2025 at its annual Capital Markets Day in November 2019. The Step up programme has been launched by Worldsteel to help the steel industry contribute to the global transition towards a carbon-neutral economy. It is focused on four main areas: optimal selection and use of raw materials, energy efficiency, increased productivity and process reliability.

Severstal is one of the very first companies to pilot the Step up methodology, which Worldsteel hopes to roll out with steel producers globally. Worldsteel’s members represent more than 80% of global steel production. On 10-12 September, Worldsteel specialists held a series of meetings with Severstal experts and management at the Cherepovets Steel Mill production site in order to determine areas of work to improve process efficiency and reduce greenhouse gas emissions. The parties agreed upon on a methodology for estimating СО2 emissions, identified key drivers for reducing emissions and developed the programme of initiatives under the Step up umbrella to set new industry best practices.

Alexander Shevelev, CEO of Severstal, commented:

“Severstal has been collaborating with Worldsteel on its GHG benchmarking for several years. According to Worldsteel, the Cherepovets Steel Mill currently ranks 16th out of 64 companies with comparable production technology, producing 2.1 tons of СО2/ t of liquid steel (coverage areas 1-3). Severstal plans to reduce its GHG emission s significantly. At Cherepovets Steel Mill, the Company has already carried out an inventory of the main sources of СО2, has developed an emissions map and has measured carbon content in raw materials and slags to refine greenhouse gas emission factors. Looking outside of our traditional business, the global shift towards a low-carbon economy also brings new commercial opportunities, and Severstal has invested in the development of Russia’s first wind farms that will begin to meet growing demand for renewable energy. Severstal’s climate change initiatives are overseen by the Board of Directors. We believe that innovative and agile companies such as Severstal can help lead carbon-intensive industries towards impactful change.” Severstal’s goal is to be “the leader of the steel industry of the future”.

This includes helping lead the industry towards more responsible operating models through our partnership with the World Steel Association. Starting with its own business, the successful evolution of processes to reduce GHG emissions will be supported by Severstal's use of advanced technology, including machine learning and big data analytics. Severstal is a member of Worldsteel, which has united 161 industry companies from 60 countries since 2001. The Company actively supports the association's initiatives, takes part in the work of major committees and in the implementation of joint projects.