New Zealand also wants to build resilience to the impacts of climate change, to reduce waste, lessen our impact on the environment and sustain and enhance our economic and social wellbeing.
Some might say the metals industry, which contributes a share of the 6% of total New Zealand CO2 emissions produced by industrial processors and product users, is a problem in this vision. Keeping in mind, energy and transport produce 41%.
True, there is not yet a commercially viable technology to make steel and aluminium without carbon. Though there are some promising signs such as replacing coal with hydrogen, but it’s a way off.
We need metals
Metals are critical to building low-emissions infrastructure energy like wind, solar and geothermal.
We also need metals to upgrade our aging water, energy and mass transit systems.
Indeed, metals are going to be crucial to delivering on Budget 2019’s $1 billion investment in KiwiRail, as well as development of the Auckland City Rail Link – both crucial to reducing transport emissions.
If New Zealand cuts metals production to reduce domestic emissions, we would need to import a lot of steel and aluminium to meet demand – exporting our problem and creating more emissions to boot from the freight.
We are already importing a lot of steel and generally have no idea about its embodied emissions, environmental credentials and working conditions of the businesses that produce them.
A sustainable industry
Our metals manufacturers have Environmental Product Declarations, environmental choice or CEMARS certification and exemplary health and safety and workforce conditions.
NZ Steel’s Glenbrook plant generates up to 70% of its electricity on site from co-generation and waste products such as gases are harvested, separated and sold.
Further, metals manufacturing generates over 30,000 full-time equivalent jobs in small to medium sized businesses in our regions, generating some $3.3 billion in GDP annually.
Using more steel in our buildings will also help keep our trees in the ground to embody carbon. Research has shown that trees grow faster as they age, sequestering more carbon than smaller trees, and faster.
Yet New Zealand is harvesting plantation forests at around 18 years old to meet export demand and for use in low-value construction uses.
Metals like steel and aluminium are also infinitely recyclable and easily re-used and repurposed so don’t end up in our landfills. Doing more of this could reduce greenhouse gas emissions in some manufacturing sectors by 79 to 99 per cent, in to a recent report from United Nations Environment Programme.
So, there’s a clear role for New Zealand’s metals industry in a better future.
So what do we need to do?
The industry supports the Zero Carbon Bill and is ready to work with Government to ensure we are part of the solution.
We need to see policy developed that ensures New Zealand metals products are treated equally in the carbon market. Imported metal products should be subjected to the same carbon emissions taxes as those made here.
We would also like to see support programmes for small and medium-sized businesses to become carbon zero, excluding raw materials.
To reduce some CO2 emissions, industry could invest in technology to increase use of scrap metals in producing steel with some incentivisation.
We currently export most of our scrap such as car bodies – there’s enough steel in six scrapped cars to make studs for a typical 600 sq. metre house, with no need for chemical treatment as steel is not affected by insects, dry or wet rot or fungi.
Last, but not least, there is the innovation opportunity. New Zealand pioneered the process of making iron from iron sand so we should be looking to develop new technologies to remove fossil fuel from the equation.
The Government has signalled it wants to work with industry in moving away from fossil fuels. The Wellbeing Budget has delivered $27 million to set up the National New Energy Development centre to work with industry in testing and trialling technologies. And a further $20 million over four years to establish a new science research fund for cutting-edge energy technology.
The reality is that global demand for steel and metals like aluminium is growing and production will continue as long as the world needs it.
It’s about making it as sustainably as possible.
As an industry we support that journey and are on board to play our part.