Three major renovation projects, more than one trillion yuan investment! This could be the key to a breakthrough in the steel industry

China News Network on July 7 Topic: Three major renovation projects, more than one trillion yuan investment! This could be the key to a breakthrough in the steel industry

Zhongxin financial reporter Pang Wuji

Since the beginning of this year, affected by the recovery of downstream demand less than expected, steel prices have continued to run at a low level, and the efficiency of the steel industry has further declined year-on-year.

While profit margins are being squeezed, the steel industry is also facing challenges such as energy conservation, emission reduction and green transformation. How to improve business efficiency and break the bottleneck of industry development? On July 7, at the "8 (2023th) Steel Industry Energy Conservation and Emission Reduction Forum", hosted by the Metallurgical Industry Planning and Research Institute and organized by the Metallurgical Industry Energy Conservation Professional Committee of China Energy Conservation Association, a number of guests discussed it.

He Wenbo, secretary of the party committee and executive chairman of the China Iron and Steel Association, said here that for the steel industry, there are two things (two basic measures), if it is not done well, there will be no good life, namely: creating a new mechanism for capacity governance and optimizing new policies for joint restructuring.

After the two basic measures, in order to improve the efficiency of the steel industry, it is necessary to do a good job in the three major transformation projects covering the entire steel industry, full production capacity and the whole process, namely capacity replacement, ultra-low emissions and extreme energy efficiency.

Infographic: The picture shows workers reinforcing steel bars. Photo by China News Agency reporter Jia Tianyong

Three major renovation projects

Capacity replacement refers to eliminating backward production capacity through market-oriented means, realizing industrial upgrading, and then controlling industry production capacity.

He Wenbo revealed that capacity replacement is a remarkable project in the history of metallurgical development in the world. As of June 2023, about 6 million tons of steelmaking capacity is planned to be renewed across China, and 4 million tons have been put into operation, far exceeding the production capacity of Japan and the European Union. According to estimates, the steel industry has invested more than 05 trillion yuan in the field of capacity replacement.

In this process, equipment upgrades, process updates, and layout optimization will bring positive effects to the industry. However, He Wenbo also reminded that there is another important principle of capacity replacement, that is, "reduction and replacement", to achieve the purpose of capacity reduction at the same time, which is of great significance to the improvement of industry efficiency.

The second largest project is ultra-low emission retrofit. Ultra-low emission transformation refers to the implementation of air pollution emission control and upgrading of all production links of enterprises in accordance with the most advanced international and domestic levels.

Fan Tiejun, president of the Metallurgical Industry Planning and Research Institute, said frankly that the steel industry has a long production process, many pollutant discharge nodes, large differences in discharge conditions, and many types of pollution factors.

In the face of these problems, in recent years, China has promoted the implementation of ultra-low emissions in the steel industry. In 2019, five ministries and commissions issued the "Opinions on Promoting the Implementation of Ultra-low Emissions in the Steel Industry", which proposed that new (including relocated) steel projects nationwide should reach ultra-low emission levels in principle; Promote the ultra-low emission transformation of existing steel enterprises.

Fan Tiejun revealed that as of June 2023, 6, about 30 million tons of crude steel production capacity of more than 270 enterprises across the country has completed or is implementing ultra-low emission transformation; 7 steel enterprises have completed the whole process of ultra-low emission transformation and publicized 6 million tons of crude steel production capacity; and 62 have completed some ultra-low emission transformation and publicized.

According to He Wenbo, so far, according to the understanding and calculation of experts from the China Steel Association, the steel industry has invested more than 2000 billion yuan in ultra-low emissions.

After the transformation action, according to the corporate sustainable development report or other public data, the emission intensity of China's key steel enterprises is basically lower than that of international advanced steel enterprises such as Nippon Steel and POSCO, and even less than 50% of some enterprises.

The third major project is extreme energy efficiency. Energy efficiency improvement is regarded as the most important, economical and direct path to achieve carbon emission reduction. In December 2022, the "Three-Year Action Plan for Energy Efficiency Benchmarking" of the steel industry was officially launched, and the Extreme Energy Efficiency Project entered the substantive implementation stage.

Li Yiren, deputy general manager of HBIS Group Co., Ltd., revealed here that in terms of HBIS' 2050 carbon neutrality target, the improvement of energy efficiency (contribution) accounts for 34%. In this field, HBIS mainly promotes the systematic improvement of energy efficiency level by cultivating energy efficiency benchmarking demonstration plants.

Fan Tiejun introduced that there are six main ways to achieve extreme energy efficiency improvement, including the extreme energy saving of process and equipment, the extreme recycling and utilization of secondary energy, the extreme energy conversion, the extreme energy saving of equipment, the extreme establishment of new energy system and the extreme energy management.

Strengthen determination and determination to transform

Looking forward to the future, Liu Bingjiang, chief engineer of the Ministry of Ecology and Environment, pointed out that the current air pollution situation is still grim, the risk of disguised new production capacity still exists, structural problems have not been fundamentally solved, and the contradiction between supply and demand balance is prominent, and the differentiation of green development levels between enterprises has intensified. The task of reducing pollution and carbon emissions and green and high-quality transformation of China's steel industry is still arduous.

He believes that the whole industry should maintain strategic concentration, continue to promote the green and high-quality development of the steel industry, and focus on four "strengthening": first, strengthen the achievements of reform and continue to consolidate the achievements of supply-side structural reform; The second is to strengthen the determination of high-quality ultra-low emission transformation and promote synergy in pollution reduction and carbon reduction; The third is to strengthen the standardized operation and management of enterprises; The fourth is to strengthen the demonstration and application of common technologies for pollution reduction and carbon reduction.

In terms of energy conservation, Ding Zhijun, deputy director of the Department of Energy Conservation and Comprehensive Utilization of the Ministry of Industry and Information Technology, revealed that in the next step, the Action Plan for Industrial Energy Efficiency Improvement will continue to be implemented, focusing on three aspects of energy conservation and energy efficiency improvement in the steel industry:

The first is to take the promotion and application of advanced energy-saving technologies as the starting point, release the catalog of energy-saving and carbon-reduction technologies and equipment in the field of industry and information technology, and promote technological energy conservation.

The second is to strengthen energy efficiency standards and meet standards as the key, continue to carry out the construction of energy efficiency "leader" enterprises and green factories, and promote management energy conservation.

The third is to accelerate the construction of industrial green microgrids, improve the level of electrification of industrial energy consumption, and promote structural energy conservation.

Fan Tiejun said that carbon neutrality is a complex, long-term and systematic project, not a simple problem of energy conservation and environmental protection, but a new change in the development mode, which requires innovation in the original production mode in many aspects such as smelting technology, production raw materials and supporting facilities. These include the possibility of cross-regional linkage of steel companies to achieve multi-regional or cross-regional carbon neutrality; Innovate traditional processes, from blast furnace-converter processes to short electric arc furnace processes, and use renewable energy in smelting processes; Develop and apply CCUS technology for the characteristics of steel production. (End)