Part I : A Blast From the Past

The government has great expectations for the steel sector – perhaps the greatest of all industries in Japan. And it’s putting money behind those expectations. Domestic steel firms are set to receive the biggest slice of state R&D financing for clean tech: At least 20% of the entire Green Innovation Fund.

As the top industrial emitter, the steel sector could make the biggest difference in the country’s efforts to meet CO2 emission reduction goals. But that’s not all. Steel is often defined as one of the four pillars of modern civilization. Changing the way steel is made could drive a shift in a number of other industries and, the government hopes, deliver on economic growth in the net zero era.

So far, details on how the sector has responded to the challenge of revamping almost its entire manufacturing and supply chain have been scant. There is a widely mentioned government target for Japan to forge 10 million tons of “green steel” by 2030, but little explanation around how that label will be applied and what is needed to achieve it.

Based on some recent demonstration projects by Japanese steel firms, and analysis of corporate actions and strategies, Japan NRG has put together a roadmap for the sector, noting what the companies say they require to transition to new technologies and what the bottlenecks may be. Our conclusion is that the government targets are possible, but the conditions required are far from straightforward.

This is the first of a two-part series that delves into “green steel” in Japan.