Volvo becomes first carmaker to join SteelZero fossil-free steel sourcing initiative

MANILA: Emphasizing its goal as a leader in climate action, Volvo becomes the first carmaker to sign up to the SteelZero initiative. The movement aims to push the use of fossil-free steel to make the global steel industry carbon neutral. 

By signing up to and following the SteelZero steps, Volvo commits itself to stringent CO2-based steel sourcing requirements by 2030. By 2050, Volvo steel sources should be net-zero, which is in line with the company’s ambition to be climate neutral by 2040.

Steel production is a major source of CO2 emissions for the automotive industry, accounting for an average of 33% of all production-related emissions for new Volvo cars in 2021, the carmaker said. 

Globally, steel production is responsible for around 7% of all greenhouse gas emissions, the carmaker cited. 

“A sustainable approach to steelmaking is not just good news for the environment, it is also good business as it limits our exposure to future climate risks and regulations,” Volvo Cars Chief Procurement Officer at Kerstin Enochsson said. 

SteelZero was launched by the Climate Group in partnership with ResponsibleSteel, a steel-industry-wide standard and certification body which Volvo Cars has also joined. Through ResponsibleSteel, Volvo can use reliable, third-party verified information about its steel supply chain and relevant sustainability credentials, to make sure the steel is responsibly sourced.

Aside from CO2 reductions, ResponsibleSteel also focuses on other important issues in the steel supply chain like labor and human rights, engagement with local communities, water use, and biodiversity impact.

The SteelZero signing is one of various initiatives made by Volvo to address one of car making’s most intensive sources of CO2 emissions. In 2021, Volvo announced a collaboration with Swedish steel maker SSAB to jointly explore the development of fossil-free, high quality steel for use in the automotive industry through SSAB’s HYBRIT initiative.

Volvo is the first carmaker to work with SSAB and the HYBRIT project in fossil-free steel development. HYBRIT aims to replace coking coal, traditionally needed for iron ore-based steelmaking, with fossil-free electricity and hydrogen. The result is expected to be the world’s first fossil-free steelmaking technology, with virtually no carbon footprint.

Volvo Cars’ ambition to by climate neutral by 2040 is part of its comprehensive climate action plan, one of the most ambitious in the auto industry. It aims to become a fully electric car maker by 2030 and plans to roll out a whole new family of pure electric cars in coming years.

Aside from these plans, Volvo aims to reduce the lifecycle carbon footprint per car by 40% between 2018 and 2025, including through reducing carbon emissions in its supply chain by 25% by 2025.

In terms of its own operations, the company aims for climate-neutral manufacturing by 2025. Today, all of Volvo’s European plants run on 100% clean electricity, while its Torslanda plant in Sweden is fully climate-neutral. Elsewhere in the world, its Chengdu and Daqing sites in China are also powered by climate-neutral electricity. 

Photos from Volvo

Also read: Volvo raises €500-M for electric transformation