Sustainability is fast becoming an important concept for businesses across all industries to embrace. By definition, sustainability is all about achieving a balance between the environment, equity and economy. This is because sustainability assumes that resources are finite and must be used conservatively to ensure that future generations have enough to continue to fulfill their own needs. Any sustainable practices should thus support economic health while improving quality of life, ecological health, and preserving natural resources.

Although the general population has become more aware of the growing importance of going green and being sustainable, several related issues have become far more urgent, especially those driven by climate change. And with the unprecedented global pandemic demonstrating that health, agility and resilience can make or break the economy, sustainability is back to the top of the agenda for the government and other important thought leaders. Consumers and clients have also become more vocal about their concerns revolving around sustainability issues. This has, in turn, increased the expectations on corporate responsibility, pushing leading companies to be more transparent and live up to their sustainability commitments.

The Importance of Decarbonising the Steel Industry

The steel industry represents a vast majority of metal products and is a critical material for economic development. However, steel is also one of the largest carbon dioxide-emitting industries. Being energy-intensive, steelmaking contributes close to 10% of the world’s total carbon emissions. This makes steel the key material for global sustainable initiatives, and its decarbonisation a global priority. In fact, achieving climate change goals will require the decarbonisation of the steel industry.

But this process of decarbonising the entire industry is not impossible. Easily sorted from other materials, and given its endless recyclability, steel is the perfect material to target when it comes to going about sustainability correctly. Once known as a “smokestack” industry, key players in the steel industry have since understood the economic and social impact they can make. Therefore, the introduction of new technologies and practices to become a greener industry has become commonplace.

Moreover, with environmental sustainability shifting from a random boutique concept to one of survival, even the government has been coming up with more initiatives. For example, in an attempt to accelerate the transition to a low-carbon and climate-resilient future, the National Determined Contribution (NDC) of Indonesia has shifted its net-zero target date from 2070 to 2060. It has thus become more important for steelmakers to do their part and improve their sustainability of operations to get ahead of the ever-evolving carbon regulations.

Low-Carbon Roadmap to Improve Sustainability of Steel

Widescale advances in technology have been occurring throughout the globe, and the steel industry is no different. Through the increased awareness of green steel, and other innovations and design, the steel industry is making several moves to reach its ultimate goal of carbon neutrality. Some advancements that have been made thus far include innovations whereby steelmakers reduce their raw material input by melting down scrap metal. Structural steel is also being recycled globally as it eliminates the need of coal-dependent processes, making it significantly less energy-and emissions-intensive than ore-based steel production.

However, fully decarbonising the steel industry is not an easy process that can happen overnight. This is emphasised by the fact that most technologies for green steel are still in their experimental stage. This means that a global effort is required to help guide the sustainable transition as these technologies become more sophisticated. Some actions that can be taken include:

1. Adopting Clean Technologies

Steelmakers need to understand that the high initial capital investment on adopting clean technologies will be offset by the long-term benefits. For a start, adopting these clean technologies will provide companies with a competitive edge, especially given the evolving carbon regulations. Some emerging technologies that can be adopted include – carbon capture and using green hydrogen generated by renewables. While these technologies are still in their early stages of development, when they do eventually become sophisticated, they will be economically feasible and scalable solutions that can mitigate financial risks.

2. Increasing Production of Sustainable Steel

 There has been an increasing demand for low-carbon supplies. With the possibility of the government boosting demands further, it makes sense for steelmakers to produce more green products to capitalise on this demand before the field is flooded with competition. This is especially so since the current production rate of green steel is limiting availability.

 3. Embracing Digitalisation

There has been a notable evolution in digitisation. It thus comes as no surprise that leading companies have been taking full advantage of the efficiency delivered by digitisation. As such, more steelmakers should follow in the footsteps of these digital leaders. Why? Because from defect recognition to quality assurance, leveraging on digital solutions can improve productivity through the optimisation of energy consumption, minimise waste and control emissions.

4. Accelerating Transition by Collaborating with Stakeholders

Lastly, steelmakers should make decisions based on the demands of stakeholders. By aligning with them, the pace for change will quicken and more feasible solutions can be created to address complex challenges. Therefore, rather than focusing on financial costs, collaborating with key players is crucial to reach green steel and climate change goals.

Gunung Prisma’s Answer to Climate Emergency

gunung prisma indonesia steel industry

At Gunung Prisma, we aim to deliver superior value to our customers and shareholders while strengthening the communities for the future. Understanding that the need for steel is universal, Gunung Prisma is always there to help our clients meet their steel needs – even when it comes to green steel and embracing sustainability.

“To serve our clients with integrity, Gunung Prisma puts innovation at the forefront of our business model. By creating trustworthy partnerships, we can deliver superior products to all our clients. Factoring in their demands, we are aware of the rise in popularity revolving around green steel. As a result of this, we are actively leveraging our expertise to meet these demands to create a greener future,” states Liwa Supriyanti, director of Gunung Prisma.

It is known that the most efficient companies are the ones that generate the most value with the least amount of resources – be it labour and capital, energy, or carbon emissions. Gunung Prisma believes that being holistic is one of the core principles of resource-productive operations. Therefore, the whole organisation is involved to sustain the change that we want to bring. Aware of the green opportunity for Indonesia’s steel sector and the importance of getting onboard the sustainability train, Gunung Prisma continues to seek ways to play its part in decarbonising the steel industry so as to stay true to its green commitment.