The impact of cautious coal power phase-out on decarbonization of China's iron and steel industry

Abstract

Existing studies are probably overly optimistic about the coal power phase-out and lack analysis of the environmental impact of uncertainty in power mix optimization. This will weaken the reliability of the iron and steel industry (ISI)'s low carbon pathway and undermine the targets of CO2 emission reduction. To fill this gap, this study constructs a bottom-up energy system model that includes iron and steel (IS) production, power generation, and hydrogen production. By incorporating five representative CO2 reduction measures and two electricity structure development paths, namely the orderly phase-out of coal power scenario (OP scenario) and the cautious phase-out of coal power scenario (CP scenario), the integrated impact on CO2 emissions is analyzed. Compared with existing studies, this study focuses more on the uncertainty of power mix optimization and devotes to enhance the ability of the ISI to cope with this uncertainty. The results show that the power mix with a high proportion of coal power will significantly increase the difficulty of decarbonization of the ISI. In 2050, the ISI will emit at least 600.53 Mt of CO2 in the CP scenario, i.e., 124.10 Mt CO2 higher than in the OP scenario, and will require greater reliance on CO2 emissions capture, utilization, and storage (CCUS) and carbon sinks to achieve zero carbon emissions. Among the five measures considered, the high proportion of coal power in the power mix will entail a loss in the emissions reduction effect of hydrogen metallurgy, which will cumulatively emit 235.18 Mt CO2 in the period 2020–2050. The active promotion of energy-saving technologies and the increase of the scrap ratio can abate the negative impact of the cautious phase-out of coal power. These findings are expected to provide the government with references to formulate mitigation policies for the ISI in China and in other countries under the uncertainty of renewable energy development.