Introduction; Proliferation and the risk of fragmentation: challenges for trade and decarbonization

Iron and steel production accounts for 8% of annual carbon emissions; global steel production has tripled in the past 50 years with 1.8 billion tons produced in 2020; 22.9% of steel products were traded in the same year; steelmaking emissions are difficult to reduce due to limited efficiency, abatement options, and costly alternatives. (pp. 4-5, Box 1)
Consistent and transparent measurement, traceability, and verification underpin trade-related climate measures; good methodologies enable accurate information and comparisons across products, processes, and technologies and deliver confidence in net zero claims. (p. 4)
Under stringent climate policies or pricing, first movers can suffer competitively; applying common standards can help by creating markets for green steel products. (pp. 4-5)
There are 20 different steel decarbonization standards and initiatives, some with different boundaries and technologies; including mining, minerals, and metals industries, there are over 150 sustainability standards and initiatives; there are no globally accepted definitions of green, near-zero, or low-emission steel, or common global approach and methodology for assessing the lifecycle of embodied emissions. (pp. 5-6, Table 1)

Standards for measuring emissions are needed to increase process efficiency, track the implementation of innovative technologies, and provide emissions data to consumers, for regulatory compliance and to access green financing. (pp. 7 and 9)
The International Energy Agency (IEA) identifies four key features for emissions measurement standards, i) emission scope and targeted greenhouse gases; ii) supply chain scope; iii) granularity of application; and iv) measurement methodologies and data requirements; different standards calculate each feature in different ways. (pp. 7-9; Table 2)
Definitions and performance thresholds for low-carbon or near-zero steel are important for stimulating investment in low-carbon markets and enabling price differentiation to help mitigate carbon leakage, provide a basis for government policy to support low-carbon technologies and green government procurement, and inform consumers. (p. 10)
To be effective and credible, definitions and thresholds should be based on agreed, consistent, comparable, and transparent measurement standards, taking into account scrap steel usage given its contribution to lower carbon footprints compared to iron-ore-based production. (p. 10)
Near-zero steel and net-zero steel represent the highest decarbonization ambitions; such definitions are being refined and developed continually including associated quantitative thresholds of allowable tons of CO2 emissions per ton of crude steel. (pp. 10-11, Table 3)