China's steel industry is expected to be included in the national carbon trading market this year, according to an interview with the China Iron & Steel Association (CISA) by China Environment News on 5 June.

The representative of CISA said that China's low-carbon emission steel standards are in the research stage and are expected to be released this year. At the same time, the steel industry will soon start carbon trading, following the official launch of online trading of carbon emission allowances by the power generation industry in July 2021, Kallanish notes.

According to CISA, about 80 leading Chinese steel companies have started carbon emission allowances pilot trading in the past 2-3 years. The annual crude steel output of these companies totalled about 130 million tonnes. Trading carbon emission allowances can improve the market competitiveness of low-carbon emission steelmaking companies, and is expected to promote the development of low-carbon emission steelmaking technology and generate a premium for China's low-carbon emission steel products.

From 2014 to 2023, the average comprehensive energy consumption per tonnage of steel of CISA's key steel companies has decreased by 5.87%, according to CISA data. 95 Chinese steel companies have completed ultra-low emission transformation of the entire steelmaking process, involving a crude steel production capacity of about 450 million tonnes/year. In addition, 42 steel companies with 144m t/y of steel production capacity have completed partial ultra-low emission transformation, and 32 steel companies are in the process of ultra-low emission transformation, involving about 54m t/y of crude steel production capacity.

To achieve ultra-low emissions, steel companies need to invest more than CNY 400/t ($55) into steel production and more than CNY 70/t in additional maintenance fees. Therefore, CISA calls on the government to give more policy support to steel companies that have completed ultra-low emission transformation to encourage the development and application of low-carbon steelmaking technologies.