The steel industry has long been the backbone of global infrastructure, powering everything from construction and automotive manufacturing to energy production. However, it is also one of the most energy-intensive sectors in the world, responsible for 8% of the global energy demand. In addition, steel production also accounts for 6 - 9% of global carbon emissions.
With climate change concerns becoming more pressing annually, businesses and governments must adopt solutions that embrace sustainability. One such solution has been the push towards net-zero emissions and green steel manufacturing.
What is Green Steel Manufacturing?
Steel is traditionally manufactured by heating iron ore in blast furnaces at extremely high temperatures, a process that relies heavily on coal-based energy sources. This method, known as the blast furnace-basic oxygen furnace (BF-BOF) route, is highly energy-intensive and releases significant amounts of carbon dioxide (CO₂) and other greenhouse gases into the atmosphere.
However, green steel manufacturing aims to replace coal-based energy with cleaner alternatives. Manufacturers can drastically cut emissions by shifting toward electricity-driven steelmaking.
The challenge, however, is ensuring that the electricity used is derived from renewable sources — and solar energy plays a vital role in this process.
Solar power offers a sustainable, cost-effective, and stable energy source for green steel production. Integrating solar energy into steel manufacturing operations enables producers to reduce carbon emissions and lower long-term energy costs while ensuring compliance with global sustainability standards.
The Energy Challenge in Asia Pacific's (APAC) Steel Industry
Several key energy-related challenges are accelerating the shift toward green steel manufacturing in APAC:
- Rising Electricity Costs: Countries like Japan, South Korea, and Australia are experiencing record-high energy prices due to their dependence on fossil fuels.
- Grid Instability & Power Shortages: Developing economies such as Vietnam face frequent power disruptions, which impacts steel production efficiency.
- High Carbon Emissions & Decarbonisation Pressure: Traditional coal-powered steel plants contribute massively to emissions, making alternative energy sources like solar power crucial for reducing environmental impact.
- Dependence on Imported Fossil Fuels: Many APAC countries rely on imported coal and natural gas, making steel manufacturers vulnerable to global energy market fluctuations.
Why Green Steel Manufacturing is a Must for Manufacturers
As global industries move toward sustainability, consumers and businesses will begin demanding that steel producers adapt — those who fail to adapt risk falling behind. By integrating solar energy into steel production, manufacturers can significantly reduce reliance on traditional fossil fuels while ensuring long-term competitiveness.
Here's why making the move to green steel is a must for manufacturers:
1. Regulatory Compliance and Carbon Reduction Goals
Governments across APAC are tightening environmental regulations to curb industrial carbon emissions, pushing steel manufacturers to adopt alternative energy sources like solar power to remain compliant and competitive.
While the region contributes significantly to the world's steel supply, the more carbon-intensive basic oxygen steelmaking (BOS) process is still the predominant form of manufacturing.
This high-emission method, which relies heavily on coal-based energy sources, generates vast amounts of carbon dioxide (CO₂), making the steel industry one of the most significant contributors to global greenhouse gas emissions. With climate policies tightening and carbon pricing mechanisms being introduced, steelmakers in APAC face growing pressure to transition to low-carbon alternatives.
Steel manufacturers must shift towards greener production methods to remain competitive in both domestic and international markets.
However, these processes require massive amounts of electricity, making the source of that electricity critical to achieving true sustainability. This is where solar power emerges as a viable solution — providing cost-effective, renewable energy to help steelmakers decarbonise operations while maintaining profitability.
2. Market Demand and Competitive Advantage
The demand for sustainable, low-carbon steel is rapidly growing across automotive, construction, and consumer goods industries, forcing manufacturers to rethink their energy strategies.
As governments worldwide and in APAC enforce stricter carbon regulations, steel producers that fail to adopt green steel manufacturing risk losing market share to competitors that embrace solar energy and other alternative energy solutions.
From carbon tariffs on exports to net-zero targets, steel manufacturers are under increasing pressure to transition toward low-emission production methods. Here's a breakdown of the key factors making green steel a necessity:
3. Long-Term Cost Savings and Energy Stability in Green Steel Manufacturing
Steel manufacturing is an energy-intensive process, requiring vast amounts of power to sustain operations. In APAC, where over 70% of the world's steel is produced, manufacturers are grappling with rising electricity costs, energy supply volatility, and carbon reduction pressures.
The answer could lie with solar energy, which allows steel manufacturers to leverage alternative energy sources to reduce operational costs and enhance sustainability.
While these methods eliminate the reliance on coal-based blast furnaces, they require massive amounts of electricity to function efficiently. Suppose this electricity comes from fossil fuel-powered grids. In that case, the carbon footprint remains significant—limiting the true impact of green steel.
Solar energy plays a transformative role in this context. By integrating solar power into steel production, manufacturers can decarbonise their energy supply, significantly reduce greenhouse gas emissions, and more effectively achieve net-zero goals.
How TotalEnergies ENEOS Supports Steel Manufacturers in the Green Steel Transition
The shift toward green steel has become necessary as the APAC steel industry faces increasing pressure to decarbonise and adopt sustainable manufacturing practices.
However, this transition presents significant challenges, including energy security, cost barriers, and the need for reliable renewable power sources. This is where TotalEnergies ENEOS steps in as a trusted partner, providing end-to-end solar energy solutions tailored to the unique demands of steel manufacturing.
Solar Energy Solutions for Steel Plants
Steel manufacturing requires high, uninterrupted power, making solar energy integration essential. TotalEnergies ENEOS delivers:
- Custom solar solutions (rooftop & ground-mounted solar systems).
- Energy storage integration to ensure power stability.
Reducing Costs with Power Purchase Agreements (PPAs)
Switching to solar energy can be hassle-free with TotalEnergies ENEOS' PPA model, allowing manufacturers to adopt solar power with zero upfront investment. Benefits include:
- Lower energy costs than grid electricity.
- No capital investment — TotalEnergies ENEOS finances and manages the entire system.
- Long-term price stability, reducing exposure to fossil fuel volatility.
Meeting Sustainability and ESG Goals
Governments and global markets demand low-carbon steel, and solar energy helps manufacturers stay compliant with regulations like:
- APAC net-zero targets, ensuring long-term competitiveness.
- ESG & sustainability commitments, attracting investors and customers.
The Future of Green Steel with TotalEnergies ENEOS
As the demand for low-carbon, sustainable steel grows, TotalEnergies ENEOS is committed to empowering steel manufacturers across APAC with innovative solar energy solutions.
By reducing costs, ensuring energy security, and supporting carbon reduction goals, we help steel producers navigate the complex transition to green steel manufacturing and secure their place in the future of sustainable industrial production.
Join the transition to solar-powered green steel today. Contact TotalEnergies ENEOS to explore how we can help you achieve sustainability and long-term success through solar energy.