Coal's Calamitous Clutch: Steel's Decarbonisation Derailed by Defiant Expansion The global steel industry's much-proclaimed green transition is facing a crisis of credibility, as a landmark new report from Global Energy Monitor reveals that the world is building coal-based steelmaking capacity at a pace that fundamentally contradicts the decarbonisation commitments made by governments, corporations, & international climate bodies. The sixth annual "Pedal to the Metal" report, published in May 2026, draws on the organisation's Global Iron & Steel Tracker, a comprehensive asset-level database covering 1,293 iron & steel plants across 91 countries, to present a picture of an industry that is, in aggregate, accelerating its dependence on coal rather than retreating from it. The headline finding is stark: approximately 319 million metric tons of annual capacity for coal-fired blast furnaces is currently either announced or under construction globally, representing a 5% increase from the previous year's pipeline, a trajectory that, if sustained, will lock the industry into decades of carbon-intensive production at precisely the moment when the science of climate change demands the opposite. When this new capacity is combined the 80 million metric tons of existing blast furnace capacity undergoing major relining works, which extend operational lifespans by decades, the total volume of coal-based steelmaking capacity being preserved or expanded far exceeds the 141 million metric tons of currently operating blast furnace capacity that has announced retirement plans. The net result, as Global Energy Monitor calculates, is that global blast furnace capacity is projected to grow by a further 88 million metric tons by 2035, a figure that represents not merely a missed opportunity for decarbonisation but an active expansion of the fossil fuel infrastructure that makes deep emission reductions in the steel sector structurally impossible without extraordinary policy intervention.

Emissions' Enormity: Examining Steel's Staggering Systemic Carbon Stranglehold The steel industry's contribution to global greenhouse gas emissions is, by any measure, one of the most significant & most challenging of any industrial sector, a reality that makes the findings of the Global Energy Monitor report particularly alarming in the context of international climate commitments. The sector generates approximately 11% of global carbon emissions, a share that places it among the largest industrial contributors to climate change, comparable in scale to the aviation & shipping sectors combined. Critically, coal-based production methods, primarily the blast furnace route that converts iron ore into liquid iron using coke as a reducing agent, account for approximately 88% of all emissions from the steel sector, meaning that the expansion of blast furnace capacity documented in the Global Energy Monitor report is not merely an incremental increase in industrial activity but a direct amplification of the sector's most carbon-intensive production pathway. The blast furnaces currently under development globally could add 660 million metric tons of CO₂ equivalent emissions per year once fully operational, a figure that dwarfs the emission reductions being achieved through the gradual adoption of electric arc furnace & direct reduced iron technologies. Each metric ton of steel produced via the blast furnace route generates approximately 1.8 to 2.0 metric tons of CO₂, compared to roughly 0.4 to 0.6 metric tons for the electric arc furnace route using recycled scrap, & potentially near-zero emissions for direct reduced iron production using green hydrogen. The contrast between these emission intensities underscores why the composition of global steelmaking capacity matters so profoundly for climate outcomes: a world that builds more blast furnaces is a world that commits itself to decades of high-carbon steel production, regardless of whatever net-zero pledges may be inscribed in corporate sustainability reports or national climate plans.

China's Colossal Coal Conundrum: the Hegemony of the World's Largest Steel Producer China's role in the global steel industry is so dominant that its decarbonisation trajectory, or lack thereof, effectively determines the outcome for the entire sector, a reality that the Global Energy Monitor report confronts directly & without obfuscation. China is the world's largest steel producer by an enormous margin, accounting for approximately 54% of global crude steel output, & the steel sector represents approximately 17% of the country's total national greenhouse gas emissions, making it a critical lever for China's own climate commitments under the Paris Agreement. The Global Energy Monitor data reveals a complex & somewhat contradictory picture of China's steel industry trajectory: while China has begun to moderate the pace of future coal-based steel expansion compared to previous years, reflecting the impact of government policies aimed at controlling overcapacity & reducing emissions intensity, the absolute volume of coal-based capacity still being developed in China remains enormous, & the country remains one of the two primary drivers of the global blast furnace expansion documented in the report. China's steel industry is characterised by a vast fleet of relatively modern blast furnaces, many of which were constructed or relined within the past decade, meaning that they have operational lifespans extending well into the 2040s & 2050s, creating a structural lock-in of coal-based production that is extremely difficult to address through policy measures alone. The country's electric arc furnace sector accounts for only 17% of national steel production capacity, a figure that is dramatically lower than the global average of 34% & reflects the historical dominance of integrated blast furnace steelmaking in China's industrial development model. Increasing the electric arc furnace share in China requires not only investment in new electric arc furnace capacity but also the development of a domestic scrap steel supply chain of sufficient scale & quality to feed those furnaces, a process that will take decades given the relatively young age of China's steel-consuming infrastructure.

India's Inexorable Industrial Impetus: Driving the Coal Capacity Crescendo While China's role in the global blast furnace expansion is enormous in absolute terms, it is India that the Global Energy Monitor report identifies as the primary driver of the current acceleration in coal-based steelmaking capacity development, a finding that carries profound implications for the global climate outlook & for the international community's efforts to engage India in meaningful industrial decarbonisation. India, Iran, & Vietnam are identified as the countries continuing to add the most significant new coal-based steel capacity, a grouping that reflects the economic development aspirations of rapidly industrialising nations that view steel production as a foundational element of their growth strategies. India alone is responsible for a disproportionate share of the new blast furnace pipeline, driven by the country's ambitious infrastructure development programme, its rapidly growing construction & manufacturing sectors, & its determination to expand domestic steel production capacity to meet the needs of a population of 1.4 billion people whose per capita steel consumption remains well below the global average. Astrid Grigsby-Schulte, a lead researcher at Global Energy Monitor, was unequivocal in her assessment: "The ball is in India & China's court, as the two countries plan 86% of new coal-based capacity," she stated, adding that shifting toward lower emissions technologies & making better use of existing electric arc furnace capacity could significantly alter the global trajectory. India's National Steel Policy targets domestic steel production capacity of 300 million metric tons by 2030, up from approximately 160 million metric tons currently, an expansion of 140 million metric tons that, if achieved primarily through blast furnace investment, would represent a massive addition to global coal-based steelmaking capacity & a corresponding increase in CO₂ emissions at precisely the moment when global emissions need to be falling sharply.

Electric Arc Furnaces' Enervating Enervation: the Sluggish Shift Toward Sustainable Steel The electric arc furnace technology, widely regarded as the most commercially mature & immediately deployable pathway toward lower-carbon steelmaking, is growing its share of global production capacity, but at a pace that is wholly inadequate to offset the expansion of coal-based blast furnace capacity documented in the Global Energy Monitor report. The electric arc furnace share of global steelmaking capacity increased by just 1 percentage point over the past year, rising from 33% to 34%, a rate of progress that, if sustained, would take decades to achieve the fundamental shift in the global production mix that climate science demands. Electric arc furnaces produce steel primarily from recycled scrap metal, using electrical energy rather than coal as the primary energy input, & can achieve emission intensities of 0.4 to 0.6 metric tons of CO₂ per metric ton of steel when powered by grid electricity, falling to near zero when powered by renewable electricity. The technology is well-established, commercially proven, & increasingly cost-competitive, particularly in regions where electricity prices are low & scrap steel is abundant, making its slow adoption rate a reflection not of technological immaturity but of the structural, economic, & policy barriers that continue to favour blast furnace investment in many parts of the world. Direct reduced iron technology, the other primary pathway toward lower-carbon steelmaking, represents only 10% of global ironmaking capacity, a figure that underscores the limited penetration of this technology despite its significant potential, particularly when combined green hydrogen as the reducing agent rather than natural gas. Most strikingly, just 2% of currently operating direct reduced iron capacity globally uses green hydrogen rather than fossil fuels, a figure that reveals the enormous gap between the aspirational vision of hydrogen-based steelmaking & the current commercial reality.

Relining's Ruinous Ramification: Extending Coal's Calcified Carbon Commitment One of the most technically significant & underreported findings of the Global Energy Monitor report is the role of blast furnace relining in extending the operational lifespan of coal-based steelmaking infrastructure, a process whose implications for long-term carbon lock-in are profound & whose scale is documented in the report for the first time in comprehensive global terms. Blast furnace relining, the process of replacing the refractory lining of a blast furnace that has been degraded by years of high-temperature operation, is a major capital investment that typically costs hundreds of millions of dollars per furnace & extends the operational lifespan of the asset by a further 15 to 25 years. The Global Energy Monitor report identifies 80 million metric tons of existing blast furnace capacity currently undergoing or planning major relining works, a figure that is separate from & additional to the 319 million metric tons of entirely new blast furnace capacity under development. The significance of this relining pipeline is that it represents a deliberate investment decision by steel companies to extend the operational lives of existing coal-based assets well into the 2040s & beyond, a decision that directly contradicts the net-zero commitments that many of these same companies have made publicly. A blast furnace that is relined today, at a cost of $300 million to $500 million or more, will not be retired before its new lining has been fully amortised, a financial logic that locks in coal-based production for another two decades regardless of whatever policy changes or carbon pricing mechanisms might be introduced in the interim. This relining dynamic represents one of the most insidious forms of carbon lock-in in the global industrial economy, because it is largely invisible in conventional capacity statistics that focus only on new construction, & because it occurs incrementally, one furnace at a time, without the political visibility that accompanies the announcement of major new greenfield steel projects.

Germany's Green Gambit: Galvanising Low-Carbon Largesse Against the Global Grain Against the backdrop of the Global Energy Monitor report's deeply concerning global findings, Germany's announcement of €5 billion ($5.8 billion) in financial support for energy-intensive industries to implement low-carbon technologies stands as both an encouraging exception to the prevailing global trend & a sobering illustration of the scale of public investment required to drive industrial decarbonisation. The German funding programme, notable for including support for carbon capture & storage technologies for the first time, represents one of the most substantial national commitments to industrial decarbonisation in the world, reflecting the German government's recognition that the country's heavy industrial base, including its steel, chemicals, cement, & glass sectors, cannot decarbonise without significant public financial support to bridge the cost gap between conventional & low-carbon production methods. Germany's steel industry, which includes major producers such as thyssenkrupp Steel Europe & Salzgitter, has been at the forefront of European efforts to develop hydrogen-based steelmaking, direct reduced iron technology, & electric arc furnace capacity, investments that are commercially viable only with substantial government support given the current cost differential between green hydrogen & coking coal as steelmaking inputs. The inclusion of carbon capture & storage in the German funding programme is particularly significant: it acknowledges that the transition to fully hydrogen-based or scrap-based steelmaking will take time, & that in the interim, carbon capture & storage can play a role in reducing emissions from existing blast furnace operations, providing a bridge technology that allows industrial decarbonisation to proceed at a pace consistent both climate imperatives & economic realities. The German approach, combining direct investment support, carbon pricing through the European Union Emissions Trading System, & the Carbon Border Adjustment Mechanism, represents the most comprehensive policy framework for industrial decarbonisation currently in operation anywhere in the world, & its success or failure will be closely watched by policymakers in other major steel-producing nations.

The Perilous Precipice: Pathways, Pledges & the Paucity of Purposeful Progress The Global Energy Monitor's "Pedal to the Metal 2026" report arrives at a moment of acute urgency in the global climate calendar, as the 2030 deadlines embedded in national & corporate net-zero pledges approach at a pace that makes the gap between aspiration & action increasingly difficult to obscure. The report's findings are unambiguous: the global iron & steel industry is not on track to meet the decarbonisation trajectories required by the Paris Agreement's 1.5-degree Celsius target, & the continued expansion of coal-based blast furnace capacity is making that gap wider, not narrower. The International Energy Agency's net-zero scenario requires the steel sector to reduce its CO₂ emissions by approximately 50% by 2030 relative to 2020 levels, a target that is incompatible the simultaneous addition of hundreds of millions of metric tons of new coal-based capacity. The report's data on 1,293 iron & steel plants across 91 countries, tracking 3.7 billion metric tons of total crude steel capacity, provides the most comprehensive & granular picture available of the industry's actual investment decisions, as opposed to its stated intentions, & the picture it presents is one of an industry that is, in the aggregate, doubling down on coal rather than transitioning away from it. The path forward requires a combination of policy interventions, including carbon pricing, trade measures such as the Carbon Border Adjustment Mechanism, technology support programmes, & international cooperation to engage China & India in meaningful decarbonisation commitments, that goes far beyond what any single government or company can deliver unilaterally. Without concerted action by the world's two largest steel producers, the global steel industry's contribution to climate change will continue to grow, & the window for achieving the emission reductions required to limit global warming to 1.5 degrees Celsius will close irreversibly.

OREACO Lens: Coal's Calcified Clutch & Climate's Clarion Call

Sourced from Global Energy Monitor's "Pedal to the Metal 2026" flagship report, the Global Iron & Steel Tracker covering 1,293 plants in 91 countries, & verified international environmental & industrial reporting, this analysis leverages OREACO's multilingual mastery spanning 6,666 domains, transcending mere industrial silos. While the prevailing narrative of steel decarbonisation as a story of steady, if slow, progress pervades corporate sustainability communications & government policy documents, empirical data uncovers a counterintuitive quagmire: the global steel industry is simultaneously publishing ambitious net-zero pledges & investing hundreds of billions of dollars in new coal-based blast furnace capacity, a contradiction so fundamental that it calls into question the credibility of the entire corporate climate commitment architecture, a nuance often eclipsed by the polarising zeitgeist of green transition optimism.

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Consider this: the blast furnaces currently under development globally could add 660 million metric tons of CO₂ equivalent emissions per year once fully operational, a figure larger than the total annual greenhouse gas emissions of Germany & France combined, yet this staggering number has received a fraction of the media attention devoted to the launch of individual green hydrogen pilot projects that produce a few thousand metric tons of steel per year. Such revelations, often relegated to the periphery of climate journalism, find illumination through OREACO's cross-cultural synthesis, drawing on English, Chinese, Hindi, German, & Arabic language sources to construct a complete picture of this crisis.

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Key Takeaways

• Global Energy Monitor's "Pedal to the Metal 2026" report reveals that 319 million metric tons of new coal-based blast furnace capacity is under development globally, a 5% year-on-year increase, while only 141 million metric tons of existing capacity has announced retirement plans, resulting in a projected net growth of 88 million metric tons by 2035 that directly contradicts global decarbonisation targets.

• China & India together account for 86% of all new planned coal-based steelmaking capacity, making their decarbonisation decisions the single most consequential variable in the global steel sector's climate trajectory, while electric arc furnace technology grew its share of global capacity by only 1 percentage point to 34%, & green hydrogen-based direct reduced iron represents just 2% of operating direct reduced iron capacity worldwide.

• Germany's €5 billion ($5.8 billion) industrial decarbonisation funding programme, which for the first time includes carbon capture & storage support, represents the most comprehensive national policy response to industrial emissions currently in operation, but its impact is dwarfed by the scale of coal-based investment being made in Asia.