Evaluating the technology path of Japanese steelmakers in green steel competition

Nozomu Kawabata

Japanese Economy, 2023, vol. 49, issue 2-3, 231-252

Abstract: This study examines the technological pathway adopted by Japanese steelmakers competing for environmentally friendly or green steel production. The pathway is identified by analyzing documents from the International Energy Agency (IEA), the Japanese government, public institutes, business federations, and steelmakers. The findings suggest that Japanese integrated steelmakers using blast furnace and basic oxygen furnace (BF-BOF) technologies have lagged in technological development and capital investment for green steel. Motivated to maintain the value of fixed capital and reputation as high-grade steel producers, they have persistently adhered to high CO2-emitting BF-BOF technology. Consequently, these firms have slowly transitioned to the lower CO2-emitting electric arc furnace (EAF) method and have been sluggish in developing the direct hydrogen reduction process that promises zero-emission production. However, the Paris Agreement and the Japanese government’s carbon neutrality declaration have pressured these companies to reassess this stance. This case illustrates that theories on the political economy of the environment and the conservative approach of large corporations toward new technologies continue to hold relevance in the era of emerging green technologies.

Date: 2023
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DOI: 10.1080/2329194X.2023.2258162

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