Roadmap for net zero emissions from the steel sector

It is estimated that the National Emission Trading System (ETS) and Border Carbon Regulation Mechanism (SKDM) applications can generate up to 1.5 billion euros annually for the transformation of Türkiye's steel industry.

The "Turkish Steel Sector: 2053 Net Zero Emission Road Map" report, prepared by Berlin-based Agora Industry with the support of Istanbul Policy Center (IPM) and Sustainable Economics and Finance Research Association (SEFiA), was announced at the press conference held in Istanbul.

In the study, the transformation of Türkiye's steel industry in line with the 2053 net zero emission target was examined through three scenarios for 2050, in which current policies continue, gradual transformation takes place and transformation is accelerated.

Accordingly, in the first scenario where current policies continue, the sector maintains its dominance in coal-based production. In the gradual transformation scenario, while coal is being phased out, the deficit in production is largely covered by imports.

In the accelerated transformation scenario based on early investment and strong policy support, the sector's emissions can decrease by 92 percent compared to 2025 levels by 2050.

In the accelerated transformation scenario, which is the only scenario in which Türkiye's 2053 net zero target is achieved, it is estimated that an annual investment of approximately 1.5 billion euros will be needed for the next 20 years for the sector to transition to low-emission production.

It was calculated that Türkiye could generate an annual income of 0.5-1.5 billion euros with the national ETS and SKDM application for imported products.

It was noted that this resource could be transferred to a green steel fund to be established and used to finance measures for the decarbonization of the sector.

"Türkiye is in a very good position in terms of exporting carbon-free finished products to the EU"

Agora Industry Global Steel Transformation Program Coordinator Ysanne Choksey, in her speech here, said that Türkiye is in an advantageous position to take advantage of the opportunities offered by decarbonization in the steel industry.

Noting that Türkiye's emissions per ton in steel production are currently relatively low, Choksey said, "This is because the country relies heavily on scrap-based steel production, which is a lower-carbon production form compared to ore-based production." he said.

Choksey stated that approximately 70 percent of Türkiye's steel production is scrap-based, and that the country has a wide electric arc furnace network that produces lower emissions.

Pointing out that Türkiye exports billions of dollars of white goods, machinery and automotive products to the European Union (EU) every year, Choksey said, "The EU has started to implement climate legislation in the last few years. SKDM was implemented at the beginning of this year and will be further tightened in the coming years. This will encourage exporters to move in this direction. We see that Türkiye is in a very good position in terms of exports to offer carbon-free final products to the sectors within the scope of EU SKDM." he said.