Volvo Crushes Other Automakers On Green Steel

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Volvo is not normal. We have written about green steel a number of times, but who is actually using it? As you might have guessed by now, the answer is Volvo Cars.

Volvo invented the seatbelt, and then gave it away for free. In topic after topic, I see the company leading on sustainability matters, and it has one of the most aggressive plans for fully electrification across legacy automakers — and the most aggressive for a vehicle brand its size or bigger. Now we also get news from a new analysis from Transport & Environment that Volvo is far and away the industry leader for using green steel.

And this is a big deal. “The study highlights that with up to 30% of car production emissions coming from steel, it is crucial that more companies focus on green steel made from renewable energy rather than from fossil fuels,” T&E writes. “The leaderboard carried out by Lead the Charge assesses three key indicators for steel decarbonisation: transparency, targets for low-carbon steel and recycled steel, and signed agreements for near-zero emissions steel.”

Here’s the chart of the leaderboard:

Here are more details on the three at the top of the leaderboard: “Volvo scores well across the board having set itself ambitious targets and having already signed a number of offtake agreements. Mercedes is close second when it comes to establishing purchase agreements with steel suppliers, having disclosed multiple agreements with suppliers in both Europe and North America. Tesla, GM and Ford make up the rest of the top five. Tesla continues to be the only company to disclose detailed scope 3 emissions from its steel supply chain.”

Kudos to Tesla for being transparent about scope 3 emissions, but, yeah, just look at how far ahead Volvo is for going out there and procuring green steel. (Ironically, #2 on this list, Mercedes, is lobbying to weaken the EU’s CO2 emissions requirements for the industry.)

By the way, if there’s one industry you want to make a switch to green steel, it’s the auto industry. In Europe, the auto industry accounts for 17% of steel demand. In the US and Germany, it’s 26%. Making a strong, rapid shift to green steel can make a big difference. “With the elimination of tailpipe emissions through electrification, decarbonising the production of cars is a crucial next step,” T&E writes elsewhere.

T&E is pushing for the European Union to adopt strong requirements and timelines for use of green steel. Here’s what they are lobbying for:

“The EU Commission should set the following requirements in IDAA:

• Introduce green steel targets in new cars: the evidence shows that 40% in 2030, 75% in 2035 and 100% in 2040 are feasible thresholds, covering both recycled and primary green steel.
• ‘Incentivise made-in-EU green steel: To strengthen the resilience of the European economy, support the EU steel industry’s effort to decarbonize, and prevent loopholes from foreign resource shuffling.”

Indeed. Hopefully Volvo Cars’ leaderships on this matter will prove to the EU Commission that more can be done and they’ll lead the way forward into greener production practices more rapidly.