Metals: What It Means to be Green

Once considered anti-environmental, the steel industry now champions recyclability and energy efficiency.

By Dan Markham, Senior Editor

For much of the 20th century, steel was perceived as just another smokestack industry pumping noxious gas into the atmosphere. In the last few decades, as a result of new technologies, an ever-increasing use of recycled material and some prodding from regulatory agencies, steelmakers have made substantial inroads in cleaning up their operations—and their reputation—as it relates to environmental matters. Today, as phrases such as “carbon footprint,” “greenhouse gases” and “sustainability” become more common, domestic steelmakers proudly claim they are no longer part of the problem, but part of the solution.

Even Service Centers Can Get Greener

While environmental regulations are a regular topic in steel producers’ boardrooms, North America’s distributors have hardly been at the forefront of the green debate. Unlike the steelmaking process, which involves extensive use of energy and generates byproducts that must be recycled or landfilled, warehousing and distribution are not such energy-intensive enterprises. Nevertheless, conscientious service centers can employ a few simple strategies to become greener.

The biggest opportunity rests with the LEED program. Leadership in Energy and Environmental Design is a program operated by the U.S. Green Building Council, through which an independent third-party agent certifies a facility meets the highest green building and performance measures.

Cleveland-based Olympic Steel’s recently completed office building at its Winder, Ga., facility is the first LEED-certified building in the state. Items such as lighting, airflow, proper windows and building materials are among the factors considered when a project is reviewed for LEED certification.

Olympic Chairman and CEO Michael D. Siegal says some additional costs must be incurred up front, but the long-term benefit is worth it. “The guiding principles around Olympic are to do the right thing,” Siegal says. “If you have the ability, you should go the extra yard on everything.”

That attitude has long been prevalent at Olympic. Each of the company’s facilities are already IS0 14000 certified. ISO 14000 is the environmental management standard designed to help companies minimize how their operations affect the environment.

Besides helping Olympic serve as a good steward, Siegal says that such an attitude sends a powerful message to potential customers about the company’s commitment to quality across the board. “All other things being equal, why am I going to pick one guy over the other?” Siegal asks. “I’d want a supplier with the highest standards.”

For operations, there are opportunities to gain LEED points through the choice of metal products. Nucor General Manager, Environmental, Steve Rowlan says companies can gain LEED points by sourcing material that was scrapped and then remelted within 500 miles of the facility.

Experts note there are many other small steps distributors can take to show their concern for the environment. For example, Yarde Metals, Southington, Conn., recycles virtually all of its products, from the obvious scrap metal to wood, cardboard and anything else that can be saved from a trip to the landfill.

Additionally, the company is considering putting solar panels on a building project, and is applying for funds from the Connecticut Clean Energy Fund to help defray some costs.

“We look at a lot of environmentally friendly options,” says Shannon Young, executive operations manager. “I can’t say we’re always going to choose them, but we definitely look at new options.”

As technologies and processes have emerged and matured, the cost differences between the status quo and going green and have shrunk. “There are definitely more cost-effective measures,” Young says. Still, “sometimes it does cost a little more to do it, but from a company initiative it’s worth the expense to help the environment.”

Finally, one of the best ways for a distributor to reduce its carbon footprint is through a measure that is also cost-effective—improving logistics and reducing the number of miles trucks travel to transport steel. When it comes to minimizing fuel consumption, and the emissions from trucks, high fuel prices are enough to turn anyone green.

“The steel industry has been ahead of the game,” says Larry Kavanagh, vice president of environment and technology for the American Iron and Steel Institute in Washington, D.C. “We’re on the leading edge and have been for quite some time.”

The push for the steel industry to reduce its emissions began in earnest in 1990, when greenhouse gas concerns first became a hot-button issue. The industry took notice. Since that time, domestic steelmakers have substantially reduced their emissions, by 33 percent according to the industry’s numbers and by an even greater 40 percent as measured by the EPA.

“Whatever number you choose, it’s a dramatic improvement compared to the goal, which was 7-10 percent,” says Bill Heenan, president of the Steel Recycling Institute in Pittsburgh, Pa.

The primary reason steelmakers have been able to cut emissions is the increased importance of scrap as a raw material, driven by the growth of domestic minimills and their use of electric arc furnaces.

“We’ve moved from where a small component of our industry was recycling-based to now where 60 percent of the steel in the U.S. is made through the recycling process,” says Steve Rowlan, general manager, environmental, for Charlotte, N.C.-based Nucor Corp. “As you do that, you take a lot of the greenhouse gases out of the system. We have the best energy-intensity number and the most efficient greenhouse gas emission number per ton than any country in the world. That’s a powerful success story right there.”

Rowlan says one key to the increased use of recycled steel industry wide was Nucor’s demonstration that steel made from scrap could be used in more applications than originally expected.

“If you look back 20 years, very few wide-flanged beams had recycled content. Now, virtually all beams made in North America have high-90-percent recycled content. If you look at Nucor’s history, it’s been one of moving recycled content into new product lines and expanding the viability of recycled steel in the marketplace,” Rowlan says.

And it wasn’t just the use of scrap material that made for a greener industry. The reduced energy required to run the electric furnaces contributes to the more environmentally friendly process.

“The advancement of the minimills was in and of itself a pollution-reducing agent, whether it’s due to the recyclability of our raw materials or the energy requirements,” says Dick Teets, president and chief operating officer for Steel Dynamics Inc., Fort Wayne, Ind. “You can go as far as considering that fewer employees come to work each day. There’s a smaller carbon footprint of people coming to work to put out the same amount of tons.”

But it isn’t just the growth of the minimill industry that has contributed to steel’s success. Integrated mills have also become more efficient at turning raw materials into a finished product, improving efficiencies from both process and labor standpoints.

In the past three years, ArcelorMittal’s U.S. facilities have accomplished a 4.1 percent reduction in energy intensity, equivalent to $131 million of annualized savings, the company claims. Increased energy efficiency is just one byproduct of the integrated mills’ reinvention since the bankruptcy-heavy days early in the decade.

“If you went back into the ‘70s, it would take about 140 pounds of raw materials to make 100 pounds of stuff out the door,” Heenan says. “Today, it takes about 114 pounds to get those same 100 pounds. The combination of factors has dramatically reduced our CO2 emissions, all while we increased production in America. We’re the only major industry that can say that. A lot of people can say they’ve reduced CO2, but they’ve moved offshore.”

Though the steel industry has made tremendous strides by improving the steelmaking process, it has the potential to do even more for the environment by assisting its customers. “Where we can make an important reduction is in our products: advanced high-strength steels; more durable steels for bridges, buildings and containers. The amount of CO2 savings we can generate by enabling our customers’ reductions is even greater than we can save in making steel in the first place,” Kavanagh says.

Despite the environmental progress, steel executives agree there’s more work to be done.

“Going forward, we need to develop new technologies that will take the place of the ones we operate today,” says Kavanagh. “We’re working internationally with steelmakers on the CO2 Breakthrough Program, trying to figure out how to make steel without using carbon as a fuel or to make steel with some form of carbon capture sequestration technology.”

Aluminum, Copper Strive for
Sustainability, Stewardship

Steelmakers are not the only metals producers that are dealing with environmental concerns. The green issue affects every industry.

Aluminum giant Alcoa, in fact, is consistently one of the most honored companies for its commitment to sustainability. Publications, environmental watchdogs and other agencies have recognized the company’s commitment and leadership on environmental fronts for years.

Kevin Lowery, a spokesperson for the Pittsburgh-based aluminum producer, says the company’s reputation is the result of decisive action taken in the early 1990s. When the climate change debate first entered the national discourse, Alcoa officials determined they would not get caught up in it.

“We essentially decided we weren’t going to debate it at all,” Lowery says. “We were just going to do something about it.”

In 2001, the company established an internal goal to reduce greenhouse gas emissions by 25 percent from a 1990 baseline. It targeted complying with this figure by 2010. The company is at a 36 percent reduction from that baseline, despite an increase in production.

“It was not easy. It required people to think differently. It required people to work differently. It required us to change the way we do things,” Lowery says. “It included investment. There was a cost to it, but there was a benefit to doing it, as well.”

With the policies and procedures in place to reduce its emissions, Alcoa is turning its attention to helping customers deal with their issues. In fact, the entire industry is touting aluminum as the material of choice in future applications.

“You look at the attributes of aluminum—it’s lightweight, strong, conductive and recyclable—it really has fantastic benefits for customers,” Lowery says.

Aluminum makers have their sights set on making even greater inroads in the transportation market. Aluminum use in automobiles has grown yearly for three decades, and that trend is expected to continue. The Aluminum Association reports that through greater use of aluminum in automobiles and the subsequent fuel savings, the entire aluminum industry could soon become “greenhouse gas neutral.”

“That’s what is expected to happen. It’s not a reach,” Lowery says. “The use of aluminum in the transportation market will more than offset the emissions created by aluminum production. That’s the ultimate green story.” (See related column in Business Topics.)

Red metals are green, too
On the red metals front, copper and brass distributors are also touting their products’ green credentials. Concast Metal Products, Mars, Pa., created a separate sales division, Green Alloys Inc., to market its low-lead alloys.

Revere Copper, Rome, N.Y., similarly markets the environmental friendliness of its architectural copper. The company’s products to that market range from 82 percent recycled content up to 95 percent recycled copper for some products.

The Copper Development Association is working on advancing the understanding of red metals’ sustainability on several fronts. Copper is a key material in many of the alternative energy sources, including wind power, solar power, wave and tidal power and ground source heat pumps. Additionally, tankless or on-demand water heaters are being advanced as a means to maintain a 24-hour reservoir of high-temperature water while curbing the energy expended. Copper’s high thermal conductivity makes it the best material for use in those units.

Finally, copper’s antimicrobial properties are continuing to be promoted by CDA and others in the industry in a variety of applications. Though not considered part of the green movement, the materials’ ability to kill bacteria can have a similar impact on improving the environments in which we all live.
ArcelorMittal is part of the EU-sponsored Ultra Low Carbon Dioxide Steelmaking project, a consortium of 48 companies from 15 European countries. The group’s goal is to demonstrate the technical and economic viability of the Top Gas Recycling and Carbon Capture and Storage concepts, and to have them employed inside existing steelmaking facilities by 2020. That date demonstrates that future technologies may take more time to implement than the previous developments.

“There is a time period between now and when these processes take hold. There is no low hanging fruit in terms of CO2 reduction that hasn’t already been plucked,” Kavanagh says.

Teets agrees, though he says his company is continuing to find ways to make the entire process more efficient. “We’re making strides all the time in energy management. New styles of burners are constantly being introduced, and most of the time they’re driven around a low-NOx or ultra low-NOx environmental philosophy. Or high-efficiency motors. They’re a little more expensive, but they’re better on maintenance, and you get a higher energy payback.”

It doesn’t end with energy. Mills are increasingly looking to get more out of the byproducts of the steelmaking process and send less material to landfills.

One of the biggest developments in that regard is the market for arc dust, a hazardous waste that has become a raw material in its own right. Companies such as Steel Dust Recycling, which opened in June 2008 in Northwest Alabama, near Severstal’s Columbia, Miss., mill, take the arc dust and process it back into usable materials.

The primary end product is zinc oxide, which the companies sell to zinc smelters. The other byproduct, an iron-rich substance, is sold as an iron additive to facilities such as concrete plants.

Steel Dust Recycling and others in the industry are looking to develop new technologies to turn that iron-rich product into an iron oxide that can be sold back to the minimills to be used as a charge in their furnaces. “There are things we can do to it, and ways we can condition it, that would make it suitable for them,” says Russ Robinson, president of Steel Dust Recycling. “That would close the recycling loop.”

That attitude is prevalent throughout the industry. Gerdau Ameristeel’s Director, Environment, Jim Turner says his company recycles all major byproducts of the steelmaking process, such as slag, mill scale and EAF dust, while also implementing a company wide goal of 100 percent water recycling to conserve water resources.

The result of the industry’s efforts is an improved image with the public at large and with an even more important constituency, legislators in Washington. But there remains work to be done on that front as well.

AISI ran a campaign touting the steel industry’s green bona fides—including its position as the world’s most recycled material and its considerable progress on emissions reduction—to Capitol Hill policymakers. “That was a group, among some segments, that did not seem to have a high awareness of steel’s recyclability,” says Nancy Gravatt, AISI spokeswoman.

The marketing campaign, which ran from 2006-08 but was pulled back when the economy faltered, has made some inroads with lawmakers. “We found we gained about 8 percent more people who recognized steel was the most recycled material. We also saw 16 percent improvement in terms of policymakers’ perceptions about the industry being modern, high-tech and environmentally progressive,” she says.

Now, the industry is united behind efforts in Washington to put the brakes on the proposed cap and trade legislation, a program to reduce carbon emissions. Under the proposal, companies will be issued a permit that limits emissions, a figure that will steadily decline through the years. Companies that reduce their emissions below their required limits can sell their permits to companies that aren’t meeting their emissions goals.

Steel industry executives believe such legislation will not lead to reduced emissions, but simply less production. Companies unwilling or unable to meet the new guidelines may simply shift production to countries that have no such regulations in place.

“Unless our trading partners have the same responsibilities and same increase in their costs, we’re at a competitive disadvantage,” says Kavanagh.

Besides hurting domestic steel’s competitiveness, industry leaders argue, the legislation will actually lead to more emissions. Since the United States is already the most energy-efficient steel producer, the argument goes, shifting production overseas will actually lead to more global carbon emissions as the production is picked up by steelmakers in nation’s with more lax controls.

“Inconsistent regulations that favor countries with lower environmental standards will mean losing domestic production and jobs to overseas producers in countries where regulations are less strict and therefore less costly. This will result in a net deterioration to the global environment,” says Gerdau’s Turner.

Rowlan at Nucor remains surprised that legislation is targeting an industry that has been outpacing established expectations for reducing emissions.

“They’re going after an industry that’s already done what it’s supposed to, and people don’t seem to recognize that,” he says. “It’s almost like we’re driving around in our electric car and everybody is saying we need to be more fuel efficient. If you’ve got somebody next to you in a V-8 pickup, there you can see the potential, but don’t pick on the guy who’s already doing the right thing.”

Teets understands the cries from the developing nations, who correctly point out that the steel industries in the United States and other developed nations were allowed to grow without much regulation. But, he says, “we’re a lot smarter today because we recognize the impacts.” Moreover, just as the minimills learned from the experiences of the integrated mills, the developing nations have the advantage of 100-plus years of technological development that should allow them to “leapfrog to the very front” of the steelmaking curve.

While being a responsible corporate citizen is increasingly important for steelmakers, there remains a responsibility to shareholders. Profitability is the key to an environmentally sustainable business model, asserts Rowlan. “If you can’t be profitable, it doesn’t matter how green your product is. You’ll be really green for a while, and then be an empty hole,” he says.

Heenan doesn’t hide the fact that the industry’s first foray into sustainability was entirely driven by the bottom line. “We’ve been green for 100 years, but the green that led us that way was the almighty dollar,” he says of the push to recycle steel. “It makes money for us, we save energy and we don’t have to use those precious raw materials.”

Decisions that save resources and energy, as well as money, are the ones the industry is most happy to crow about. “It’s great when it’s win-win,” Teets says.

But even in a profit-driven business, he adds, the calculus can change when the decision is a green one. “Even if you have a firm ROI, you can benchmark a different perspective based on social responsibilities. It’s more of a gut call than a firm paper and pencil call. There are good things inherent in it.”

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Monday, March 19, 2018