Sierra Club Joins Global Organizations in Urging South Korea's Largest Steelmaker POSCO to Halt Extension of Coal-Based Manufacturing

POSCO invests $392M USD in relining two blast furnaces at world's largest integrated steel mills
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Ginny Cleaveland, Deputy Press Secretary, Federal Communications, ginny.cleaveland@sierraclub.org, 415-508-8498 (Pacific Time)

SEOUL — The Sierra Club has joined a group of 24 civil society organizations from around the world in delivering a letter to South Korea's POSCO Holdings urging it to stop prolonging the lifespan of their coal-fired blast furnaces and develop a plan to phase out the remaining ones. POSCO Holdings is South Korea’s largest steel producer and top corporate emitter.  

POSCO plans to reline two blast furnaces at its Pohang and Gwangyang steel plants, which are the world’s two largest integrated steel mills. Relining the blast furnaces extends the use of coal in steel production and adds approximately 15 more years to the facilities’ operational lifespan. 

Currently, coal-powered blast furnaces make up around 70% of global and South Korean steel production. These furnaces are the primary cause of the steel industry’s high emission intensity. Steel production accounts for 16.7% of South Korea’s total greenhouse gas (GHG) emissions. 

Research indicates that Pohang and Gwangyang steel plants’ coal-based steelmaking leads to air pollution, causing health issues estimated to cost $2.95 billion USD in 2021. 

POSCO’s relining also goes against its climate targets of reducing emissions by 10% by 2030 and by 50% by 2050. The letter calls for POSCO to achieve its climate goals and release a plan to replace the current blast furnace facilities with greener production methods, such as scrap-based electric arc furnace (EAF) and hydrogen direct reduced iron (H2-DRI). 

Quotes from global organizations 

Yong Kwon, Senior Policy Advisor at Sierra Club: “Windows of opportunity for the steel industry’s transition to near-zero emissions by 2050 — which is less costly to industry and vastly beneficial to public health — emerge when blast furnaces reach the end of their campaign. We urge POSCO to retire coal-based steelmaking and invest in greener technologies at this critical moment.” 

Jeong Chim Gwi, Director at the Korean Federation for Environmental Movement Pohang: “Even if the relining of Pohang Blast Furnace No. 4 is operationally necessary, it is problematic that there has not been any communication with the local community. In the process of moving towards carbon neutrality, POSCO's pollutant emissions and carbon emission reduction plans must be disclosed and communicated with local stakeholders.” 

Min Kim, Co-representative at BigWave: “POSCO’s 2050 carbon neutrality roadmap is only a half-hearted plan, with no intention of reducing GHG emissions for the company’s overseas operations. POSCO needs to show leadership by increasing its 2030 GHG reduction target by at least 20% from the current 10% to align with the Paris Agreement’s 1.5°C target.” 

Heather Lee, Steel Lead at Solutions for Our Climate: “Extending the use of coal in steelmaking will not only impact the South Korean steel industry and its level of emissions but have far-reaching consequences for the national economy. Steel decarbonization is closely tied to the global competitiveness of export-oriented industries in Korea, such as automotive, electronics, and shipbuilding.” 

Caroline Ashley, Director at SteelWatch: “By relining Blast Furnace No. 4, POSCO is locking in huge carbon emissions for another two decades. That is a bad decision for the planet: directly undermining chances of stabilizing the climate crisis. It is a bad decision for the company: heading in the wrong direction away a decarbonized future-fit competitive steel producer.”  

Matthew Groch, Senior Director of the Decarbonization Campaign at Mighty Earth: “It’s time for POSCO to end the use of dirty coal-based steelmaking technologies. If they truly have global ambitions, they need to know that consumers in North America don’t want to buy products, including electric vehicles, made using coal.” 

Julia Hovenier, Banks & Steel Campaigner at BankTrack: "At this stage of the climate crisis, banks should not be supporting steelmakers who are investing in future coal use. If POSCO’s financiers are genuinely committed to the right to clean air and fighting climate change, they must engage with POSCO to stop the reline or cut ties if it continues with its plans.” 

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