Steel’s role in Aotearoa’s future

This Issue This is a part of the Concrete, steel and timber feature

By - , Build 189

Building materials will need to meet stringent low-carbon criteria as governments globally strive to meet climate change targets. The steel industry is bringing in a raft of measures and emphasising steel’s role in the circular economy.

COP26 RESULTED in increased promises and pledges to reduce carbon emissions. Aotearoa New Zealand was no exception – promising a reduction in gross 2005 carbon emissions by the end of the decade and achieving zero carbon emissions by 2050.

The building and construction industry in Aotearoa is booming. It is a significant contributor to the national economy and was the country’s fourth-largest employer in 2021. It is also a known contributor to the production of greenhouse gases.

Steel industry is changing

For Aotearoa to meet its goals, the building and construction sector must play its part. The steel industry, in concert with global partners, has been working for some time on a long-term framework that will make steel a significant global low-carbon player and help realise the country’s climate commitments. So what has it been doing?


Steel is infinitely recyclable – a HERA-commissioned study estimates 85% of Aotearoa’s building and construction steel waste is recycled and it has a long lifespan, amortising carbon over longer periods.

The sector produces 332 kilotonnes of steel scrap annually, mostly in the form of reinforcing bars, structural sections and sheet products. This amounts to 50% of the scrap steel produced in Aotearoa. Of this, only 50 kilotonnes are lost to landfill – the remaining 85% is recycled.

The study considered the global warming potential as the most important environmental indicator. It allows comparisons to be made of the global warming impact of different gases. It is a measure of how much energy the emission of 1 tonne of CO2 will absorb over a given period of time. In Aotearoa New Zealand, steel accounts for 2.2% of the country’s carbon emissions.

This recovery rate leads to savings in GWP per tonne of steel scrap generated of 1,249 kg CO2-equivalent. The challenge for the industry is to achieve 100% recovery (with steel made from scrap), which would lead to even greater potential savings of 1,473 kg CO2-equivalent.

Search for coal alternative in production

One of the greatest challenges faced by the industry is the manufacturing process. New Zealand Steel has acknowledged that ‘steelmaking generates greenhouse gas emissions, mainly carbon dioxide, both directly when making iron and steel, and indirectly through the use of electricity and gas. The majority of emissions (about 80%) come from the chemical process of making iron.’

Coal is primarily used in the steelmaking process as a reductant, rather than an energy source. Although there is research into alternative reductants, there are currently no commercially viable alternatives for coal. Until an alternative is developed, the industry needs to utilise carbon offsetting as a mechanism to reduce net emissions.

Work is under way in this area. In Australia, Rio Tinto and BlueScope will collaborate for low-emissions steel production in New South Wales, near the planned site of a new clean hydrogen-fuelled power station.

Research projects are also under way to find an alternative to coal. Victoria University of Wellington is researching novel ways to use hydrogen as the reductant in New Zealand’s unique ironsands-based steelmaking process.

Expanding the lifespan of steel

When it comes to structural steel, the current Building Code requires a lifespan of 50 years. At HERA, we are looking at what we can do in the design phase, through durability and corrosion modelling, to expand the lifespan of steel beyond 100 years. Potentially, this could be specifying either thicker steel or thicker coatings and other enhancements.

Launching zero-carbon steel programme

The world’s first comprehensive steel carbon offset programme, independently developed based on verifiable data, is earmarked for launch in 2022. It will allow companies to calculate carbon in fabricated steel items, offset carbon emissions and offer zero-carbon steel.

Around 7% of global emissions are from steel, meaning that carbon reduction is a priority interim measure ahead of a low-carbon steel production process being developed at commercial scale.

Sustainable steel certification

New Zealand’s sustainable steel certification programme is led by the Sustainable Steel Council and is measured against Treasury’s Living Standards Framework. About 70% of structural steel products have achieved certification, and the Sustainable Steel Council is helping others through the certification process.

This enables businesses, especially SMEs, to build their skills and capacity, be consistent with larger-sector businesses and keep up with government and business expectations.

Circular economy: material passports Material passports have largely been developed in Europe where there is more focus on the circular economy. A material passport for structural steel will enable it to be taken from one building or application and moved to another at the end of life. It provides a record of what the material’s quality is, where it has been and stresses it may have been under.

One of the barriers to steel reuse is the desire to avoid risk or liability associated with how it has been used or exposed such as in an earthquake. The passport means safe reuse can become more common, advancing circularity in the supply chain.

With a proposal to develop the first passport in New Zealand for structural steel, we can pave the way for other materials to be similarly tracked and reused, which will provide a template to streamline the process.

As COP26 has made clear, the global community is far off-track in limiting global temperature rise to 1.5°C. Aggressive curtailment of carbon emissions is needed, and the good news is that steel is significantly involved in Aotearoa’s circular economy in line with New Zealand’s international commitments.

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