Vattenfall: Green Steel: Premiums and Possibilities

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VattenfallImage Source: Vattenfall

Synopsis:

Vattenfall's CEO, Anna Borg, challenged the perception of the green premium on low-carbon technologies, citing the cost for a car with "fossil-free steel" as equivalent to two USB sockets. Speaking at the World Economic Forum, she argued that the estimated 25% premium for 'green steel' would diminish with increasing carbon prices. While acknowledging the potential risks, leaders in the First Movers Coalition emphasized the importance of government continuity and commitment to sustainable initiatives.

Article:

Leaders from the First Movers Coalition (FMC), including Vattenfall, emphasized their commitments to decarbonizing challenging industries such as steel, aluminium, and transport. Vattenfall, through its Hybrit joint venture, delivered hydrogen-produced steel to Volvo in 2021.

In a session at the World Economic Forum, Vattenfall's CEO, Anna Borg, addressed the perceived green premium on low-carbon technologies. She challenged the notion by illustrating that the added cost for a vehicle incorporating "fossil-free steel" could be likened to the expense of two extra USB sockets, emphasizing its feasibility.

The estimated 25% premium for 'green steel' over conventional steel was discussed within the context of increasing carbon prices. Borg asserted that as the price of carbon emissions rises, the relative difference would diminish, making green steel more economically viable.

Anna Borg highlighted the demand for green steel and urged governments not to rely on subsidies but to act as catalysts and enablers for scaling up green technologies. She emphasized that the capital is available, and continuity in government actions is vital to building trust.

Singapore's Minister for Manpower, Tan See Leng, echoed the importance of government support, citing Singapore's carbon tax as an example. He emphasized that governments play a crucial role as catalysts and enablers for green initiatives.

Tan See Leng announced Singapore's plan to shortlist consortiums for proposals on using ammonia as a low-carbon fuel. This initiative aligns with Singapore's commitment to testing and deploying a direct ammonia power plant, aiming to support the assessment of ammonia for shipping.

However, Daniel Fisher, CEO of US aluminum packaging firm Ball, cautioned that changes in regulatory environments could amplify green premiums, emphasizing the need for continued commitment to sustainability goals.

Conclusion:

At the World Economic Forum, Vattenfall's CEO, Anna Borg, challenged the perceived high cost of green technologies, using the example of the "green premium" for a car with "fossil-free steel" being comparable to the cost of two USB sockets. The discussion extended to the estimated 25% premium for 'green steel,' with Borg suggesting it would decrease as carbon prices rise. Leaders in the First Movers Coalition emphasized their commitment to decarbonization, urging governments to facilitate scaling up green technologies without relying solely on subsidies. Singapore's Minister for Manpower highlighted the importance of government support and announced plans for ammonia as a low-carbon fuel, aligning with the country's commitment to renewable energy development.

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