How the Steel Sector Is Shaping Climate and Energy Policy

Glossary

• Policy Engagement - Corporate activities aimed at influencing climate-related government policy. These include advertising, social media, responses to consultations and direct meetings with government officials. This definition draws on the UN Guide for Responsible Corporate Engagement in Climate Policy (2013).

• Steel Sector Emissions Reduction Targets - National and regional greenhouse gas (GHG) reduction frameworks that include explicit emissions reduction targets for the steel industry.

• Emissions Trading System - A market-based mechanism for reducing emissions to a specified level, typically in which a government establishes a total emissions cap within which companies can buy and sell emissions allowances.

• Carbon Border Adjustment Mechanisms - A policy that imposes a border tax based on the domestic carbon price on imported goods, aimed at preventing carbon leakage by equalizing carbon prices between domestic production and imports.

• Supply-Side Support Measures - Government policies that promote low-emission technological innovation and low-carbon steel production to reduce emissions at the production level.

• Demand-Side Support Measures - Government policies that stimulate demand for low-carbon steel, such as low-carbon steel standards, public procurement requirements, and the creation of low-carbon product markets.

This briefing brings together our assessment of climate policy engagement within the global steel sector on InfluenceMap’s new Steel Platform — covering 22 key steelmakers and eight major industry associations active at global and regional levels, including Australia, China, the European Union (EU), India, Japan, South Korea and the United States (U.S.), among others. InfluenceMap continues to expand its regional coverage — please refer to InfluenceMap’s Steel Platform for the latest coverage.

This initial analysis is structured around two sections:

1. an overall assessment of the global steel sector’s climate policy engagement; and
2. steel sector engagement with national/regional climate and energy policies.

The findings show that while most of the global steel sector is actively engaging with climate policies, its positions remain only partially aligned with the science-based policy pathways recommended by the Intergovernmental Panel on Climate Change (IPCC) to limit global warming to 1.5°C.

Figure 1-1 below visualizes the key LobbyMap metrics of global steel companies and industry associations based on their overall engagement on climate policies. The ‘Climate Change Performance Band’ indicates each entity’s overall position on science-aligned climate policy, ranging from most oppositional (left, score F) to most supportive (right, score A+). The ‘Engagement Intensity’ reflects the level of policy engagement activity, with the most active companies appearing at the top of the graph.

Of the 30 steel companies and associations analyzed by InfluenceMap, over 67% (20 entities) scored between C+ and D+ under the LobbyMap methodology, indicating that their engagement on climate policy and narratives on decarbonization are only partially aligned with IPCC guidance. Six entities scored D or below, indicating misaligned advocacy. Many of the analyzed entities are highly engaged under InfluenceMap’s engagement intensity metric, over 60% (18 entities) scored 12 or above, indicating active engagement. 10 of these, including ArcelorMittal, Nippon Steel, and SSAB, scored 25 or above, indicating strategic engagement.

Insights Across Regions

Misaligned Engagement in the U.S.

Among companies as a whole, U.S. steelmakers stand out as the most negatively engaged, with the majority of assessed companies misaligned with climate policy and science-based decarbonization pathways. Nucor Corporation and United States (US) Steel Corporation scored D-, while Cleveland-Cliffs scored D, but all scored below 12 for engagement intensity, indicating minimal engagement. The American Iron and Steel Institute (AISI) was slightly more positive but still partially misaligned with science-based pathways, scoring D+.

Mixed Engagement Within Regions

In Australia, the Australian Steel Institute (C) and Bluescope Steel (C-) show mixed engagement on overall climate policy and decarbonization. In South Korea, while Hyundai Steel and Korea Iron and Steel Association (KOSA) both scored C-, POSCO — one of the most actively engaging companies in South Korea — showed partial misalignment with science, scoring D+ and highly active engagement.

European steel companies and associations hold mixed positions, with the association leaning more negative. In Europe, SSAB (C+) emerged as a relative leader for the sector globally, but the European Steel Association (Eurofer), of which SSAB is a member, scored D+ due to its negative advocacy. InfluenceMap often detects this “lowest common denominator” effect, in which industry groups adopt the strongest negative positions held by their members. Associations may also take positions that companies prefer not to state publicly, underlining the need for greater disclosure and accountability from participating companies about their roles and influence within associations.

Japan’s steel sector shows the widest variation among its players. Of the companies assessed, Tokyo Steel Manufacturing Co — an electric arc furnace steelmaker that is one of the highest-scoring entities in InfluenceMap’s database — stood out as the only steelmaker with a positive score of A-, although its engagement intensity is lower than some of its negative counterparts in Japan. JFE Steel and Nippon Steel both score D+, indicating partial misalignment with science-based policy, with Nippon Steel notably more active. The Japan Iron and Steel Federation (JISF), similarly shows strategic levels of engagement and some of the most obstructive positions across all global entities at D-, which could be also explained with the lowest common denominator effect.

Opportunities for Positive Advocacy and Sectoral Leadership in India, China, and Australia

Indian steel entities—including ArcelorMittal Nippon Steel India (AM/NS India) (C+), JSW Steel (C), Tata Steel (C), and the Indian Steel Association (C+)—are among the most positively engaged in this analysis. This appears to align with InfluenceMap’s broader analysis of corporate climate policy engagement in India, which suggests a lack of entrenched opposition to climate policy ambition in the country. In China, InfluenceMap also observed instances of relatively positive advocacy—particularly from the China Iron and Steel Association (CISA) (C+) and Baowu Steel Group (C).

Though InfluenceMap’s analysis finds that steel companies in India and China are relatively positive, engagement remains limited in these countries (with the exception of Tata Steel, which has strategic engagement levels). Large Chinese producers such as Ansteel Group and Shagang Group displayed little to no evidence of engagement.

More active support for science-aligned climate policy, coupled with transparency on engagement, is essential for companies seeking to demonstrate leadership for advancing government climate policy and strengthening their regions’ standing within the global steel transition.

IPCC’s Sixth Assessment Report Working Group III (AR6 WGIII) Summary for Policymakers emphasizes that effective low-emission technological innovation depends on a combination of technology-push measures — such as R&D, demonstration, and skills development — alongside demand-pull policies, including standards, taxes, and other regulatory instruments. The IPCC further notes that economic instruments need to be complemented by regulation and comprehensive policy packages. Policy frameworks that rely predominantly on incentives, in the absence of clear regulatory signals, could risk the steel sector progressing more slowly than recommended under IPCC-aligned pathways.

This section summarizes key national/regional policies and outlines how the steel sector is engaging with them. The analysis is structured around five policy categories: Steel Sector Emissions Reduction Targets, National/Regional and Trade-related Carbon Pricing Policies, and Support Measures for Steel Supply and Demand. Across regions, steelmakers and industry associations have generally advocated for less stringent regulatory approaches, favoring incentive-based policies over binding requirements. Consistent with this, most climate and energy policies to date prioritize public investment and financial incentives rather than enforceable targets or regulations. For a more detailed list of policies, see Appendix I, and for up-to-date analysis, please refer to the Policy Tracker on InfluenceMap’s Steel Platform.

2-1. Steel Sector Emissions Reduction Targets

This section evaluates how steel sector actors engage with national and regional greenhouse gas (GHG) reduction frameworks, with a focus on policies that include explicit emissions reduction targets for the steel industry.

InfluenceMap found limited sectoral emissions reduction targets across the focus regions, except in Japan and South Korea. In both countries, targets that encompass steel have been set as part of their 2030 Nationally Determined Contributions (NDCs).

• In Japan, under its NDC, the government indicates sectoral emissions levels for the relevant years and encourages sectors to establish and implement voluntary action plans and targets. Within this framework, the Japan Iron and Steel Federation (JISF) had proposed the 30% emissions reduction target for the steel sector by 2030. However, for Japan’s economy-wide GHG emission reduction targets — including for 2030, and most recently 2035 and 2040 — JSIF has engaged during consultations in ways that appear to weaken the policy ambition, emphasizing economic competitiveness and a best available technology, bottom-up approach. In 2024, Nippon Steel expressed support for the 2030 GHG target after it was finalized. Tokyo Steel on the other hand, advocated for greater ambition of the 2030 and 2050 GHG targets while they were deliberated in 2023.

• In South Korea, the steel sector has generally adopted a negative stance towards a more ambitious 2030 NDC target. The Korea Iron and Steel Association (KOSA) advocated for a weaker target, citing insufficient reduction capacity and risks such as decreased steel production, negative impacts on related industries, and weakened industrial competitiveness. In addition, POSCO Research Institute (POSRI) appears to not support the 2030 NDC target, arguing that innovative reduction technologies and measures to achieve the target have not been fully developed.

• In regions with no sector specific targets, steelmakers engage with national/regional emissions reduction targets. The steel sector in Australia, China and India supported national emissions reduction targets — Bluescope has generally supported Australia's 2030 Federal GHG target of reducing emissions by 43% below 2005 levels; China Iron and Steel Association (CISA) occasionally appeared to support China’s 2030 carbon peak goal; Indian Steel Association and JSW Steel broadly supported India’s 2070 net-zero GHG emissions target. The steel sector has taken mixed positions in Europe. The European Steel Association (Eurofer) has, on some occasions, not supported the EU 2040 target of a 90% emissions reduction (from 1990 levels), while more often raising concerns about the economic and technical feasibility of achieving it without explicitly referencing the target. SSAB has actively supported the target of 90 to 95% compared to 1990 levels. The United States withdrew from the Paris Agreement, canceling previously established emissions reduction targets for 2030 and 2035.

2-2. National/Regional Carbon Pricing Policies - Emissions Trading Systems

This section assesses steel sector engagement with national/regional carbon pricing policies with a particular focus on emissions trading systems (ETS). An emissions trading system is a market-based mechanism for reducing emissions to a specified level, typically, in which a government establishes a total emissions cap, within which companies can buy and sell emissions allowances.

Most of InfluenceMap’s focus regions have implemented ETS or equivalent policy measures, except for the United States. The EU and South Korea have adopted cap-and-trade systems, while the systems in the other markets, like Japan, do not have an absolute cap on emissions at the moment. China operates an intensity-based ETS, while Australia has a baseline-and-credit system. Steelmakers in the EU, Japan and South Korea are set to receive 100% free allowances.

IPCC’s AR6 WG III suggested that “Emissions reductions could be increased with higher carbon prices and without free allocation of allowances”. The IPCC also emphasized that carbon prices must reach at least USD 40–80 per tonne of CO₂ by 2020 and USD 50–100 by 2030, USD 733 by 2050 to be consistent with the Paris Agreement targets, provided a supportive policy environment is in place. While the phases and design complexities of ETS differ across countries and regions, allowance prices have generally remained well below IPCC-recommended carbon price levels — with the EU being a notable exception.

InfluenceMap’s research shows that steel industry pushback against the design and ambition of ETS is evident across most regions except China. In the EU, where the ETS has been in place for nearly two decades and allowance prices are relatively high, such resistance has been observed for some time. More strikingly, similar pushback is also evident in South Korea and, most notably, Japan, despite their ETS frameworks being much newer and carbon prices remaining comparatively low. In these markets, steelmakers have emerged as among the most vocal opponents of policy ambition.

• In Australia, Bluescope submitted responses to the Safeguard Mechanism consultations in 2022-2023, with its overall engagement with the reforms appearing largely negative. Bluescope advocated for a baseline decline rate of less than 2% for Emissions-Intensive Trade-Exposed (EITE) facilities, emphasizing risks including carbon leakage, international competitiveness, sovereign capacity, and economic resilience for EITE facilities. Following consultations, the Safeguard Mechanism provides a reduced baseline decline rate between 1-2% to Trade-Exposed Baseline-Adjusted (TEBA) facilities.

• In China, InfluenceMap has detected limited evidence of engagement from the steel industry on China’s national carbon market and ETS. The China Iron and Steel Association (CISA) and HBIS Group supported the integration of the steel industry into China’s national carbon market.

• In the EU, the steel sector has been highly engaged, though mostly negatively, on the EU ETS throughout 2023-2025. ArcelorMittal, the European Steel Association (Eurofer), and thyssenkrupp advocated against the planned phase-out of free allocation of emissions allowances under the ETS. Meanwhile, SSAB and TataSteel broadly supported the EU ETS reform in 2023-2025, advocating for the planned phase-out of free allowances. After intensive policy engagement from industry, heavy industry sectors continue to receive a higher rate of free emissions allowances than proposed by the EU Commission.

• In Japan, the steel industry has long opposed the introduction of carbon pricing and emissions trading. Even following the introduction of GX-ETS — which includes significant concessions, such as mandatory implementation starting only from Phase II in April 2026, a later timeline than in other regions, and comparatively low carbon prices — steel industry engagement has continued to emphasize the perceived burden of carbon pricing on the sector. Concerns of varying levels have been voiced by the Japan Iron and Steel Federation (JISF), JFE Steel, and Nippon Steel about how emission allowances under GX-ETS could affect competitiveness and technology development. Tokyo Steel stood out as the only steelmaker in this assessment clearly supporting an “overall emissions quota consistent with national targets consistent with the 1.5°C target.”

• In South Korea, the steel industry, especially POSCO, have played dominant roles in shaping the Korea ETS, often in ways that reduce the ambition of the policy. POSCO and Korea Iron and Steel Association (KOSA) advocated for 100% free allocation for the steel sector, while POSCO Research Institute (POSRI) advocated for removing the carryover limitation on emission allowances, which runs counter to the ambition of removing surplus allowances to increase the carbon price and effectiveness of the scheme. POSRI also advocated for ‘realistic allocation calculation’, considering industry competitiveness. KOSA emphasized burdens for purchasing emissions allowances and suggested that ETS results in increased energy prices and loss of competitiveness. Meanwhile, Hyundai Steel expressed its support for the K-ETS to achieve carbon neutrality and called for government support. The advocacy against ambitious K-ETS appeared to be reflected in the K-ETS, including providing 100% free allowances for high-export industries.

2-3. Trade-Related Carbon Pricing Policies - Carbon Border Adjustment Mechanisms

This section assesses steel sector engagement with trade-related carbon pricing policies with a particular focus on carbon border adjustment mechanisms (CBAM). CBAM is a policy that imposes a border tax based on the domestic carbon price on imported goods, aimed at preventing carbon leakage by equalizing carbon prices between domestic production and imports.

Australia and the EU have comparatively high carbon prices and have introduced policies to address carbon leakage risks. Notably, InfluenceMap’s research identifies significant corporate engagement on the EU CBAM, with many positions misaligned with IPCC guidance advanced by steelmakers both within and outside the EU. Following intensive engagement, the policy incorporated a slower CBAM implementation than proposed by the EU Commission, alongside a slower phase-out of the free allocation of EU ETS emissions allowances.

• In Australia, three steel entities submitted consultation responses on the Carbon Leakage Review. The Australian Steel Institute stated that an Australian CBAM is a desirable policy option to address the risk of carbon leakage for domestic steel producers. Bluescope broadly supported the introduction of a “well-designed” CBAM in Australia, yet qualified this support by advocating for conditions that could weaken the policy’s decarbonization signal. Meanwhile, Japan’s Japan Iron and Steel Federation (JISF) directly opposed the introduction of a CBAM in Australia, citing the risk of unintended consequences for free trade and arguing that a CBAM is “unlikely to be an effective global warming countermeasure commensurate with such risk.”

• In the EU, the steel sector has been highly and mostly negatively engaged with the EU CBAM. European Steel Association (Eurofer), ArcelorMittal, and thyssenkrupp advocated for the EU CBAM but argued for free allocation of emissions allowances and rebates on the carbon price of EU exports to non-EU countries, although these were not mentioned in the European Commission’s initial policy ambition. Most entities also called for maintaining free allocation for sectors at risk of carbon leakage in the EU ETS. SSAB generally positively engaged with the EU CBAM, advocating for the CBAM to “start as planned in 2026” with the phase-out of the free allocation.

• The steel industry outside the EU, including ArcelorMittal Nippon Steel India (AM/NS India), the Indian Steel Association, JISF, and POSCO has also engaged extensively with the EU CBAM, mainly advocating against the policy. On the other hand, JSW Steel supported the policy as an opportunity to export green steel to the EU. Tata Steel broadly supported the EU CBAM, while advocating for an unclear “solution” for EU exports.

2-4. Supply-Side Support Measures

This section assesses steel sector engagement with supply-side support measures that specifically include government policies that promote low-emission technological innovation and low-carbon steel production to reduce emissions at the production level. The table shows a representative selection of policies from each region. For a more detailed list of policies, see Appendix I, and for up-to-date analysis, please refer to the Policy Tracker on InfluenceMap’s Steel Platform.

Across all regions covered by InfluenceMap, supply-side policies have expanded rapidly. While many such policies have been introduced, corporate engagement in some regions — particularly in China and the United States, as detailed in the Appendix and on the Steel Platform — remains limited; accordingly, this section focuses on regions where corporate engagement was observed. InfluenceMap’s research finds that steel industry actors have broadly welcomed this policy direction, particularly where it involves expanded public funding and support for technology development. At the same time, many have consistently called for greater flexibility in policy design and weaker eligibility criteria — approaches that risk extending reliance on fossil-based production pathways and slowing the pace of structural transition.

• In Australia, the overall engagement with the policy proposal on the ‘Unlocking Green Metals Opportunities for a Future Made in Australia’ has been supportive, but the steel sector, including the Australian Steel Institute and Bluescope, has also advocated for policy measures to promote new production of competitively priced fossil gas supplies.

• In the EU, the steel industry has been actively engaging with the CISAF in 2025, which appears to have influenced the final policy adopted by the EU Commission. ArcelorMittal, thyssenkrupp, and European Steel Association (Eurofer) advocated for less stringent eligibility criteria for low-carbon hydrogen and/or carbon capture and storage (CCS) technologies, while SSAB promoted a technology neutral approach to the CISAF and did not support several elements of the proposed framework.

• In Japan, the steel industry has advocated for weaker regulatory measures for steel decarbonization, often based on the recognition and inclusion of steel production technologies with some ambiguity in their alignment to IPCC guidance. Nippon Steel supported government policies to increase green hydrogen for steelmaking. Regarding national electricity policy, it also appeared to promote the construction of new thermal power plants alongside nuclear energy, as well as supporting CCUS without a clear position on the use aligned with IPCC guidance. JFE Steel supported an increase in decarbonized power mix, including renewables and nuclear, to decarbonize the steel industry, as well as government support to achieve this. At the same time it also appeared to support technological improvements to blast furnaces to reduce carbon emissions rather than transitioning the steel production process away from traditional blast furnace methods. Japan Iron and Steel Federation (JISF) advocated for policies to strengthen procurement of coking coal, stressing limitations and delays in transitioning to electric furnaces and hydrogen-reduction technologies.

• In South Korea, POSCO, Hyundai Steel, and Korea Iron and Steel Association (KOSA) advocated for government support to decarbonize the steel sector, often emphasizing economic or technological feasibility. POSCO and Hyundai Steel called for hydrogen-reduction steelmaking, emphasizing its technological feasibility but remaining unclear on a full transition in line with IPCC guidance.

2-5. Demand-Side Support Measures

This section assesses steel sector engagement with demand-side support measures that specifically include government policies stimulating demand for low-carbon steel by encouraging public and private procurement, such as the development of low-carbon steel standards, public procurement requirement, and creation of low-carbon product markets. The table shows a representative selection of policies from each region. For a more detailed list of policies, see Appendix I, and for up-to-date analysis, please refer to the Policy Tracker on InfluenceMap’s Steel Platform.

Most regions in this assessment recognize the need for creating a market for green steel - including public and private procurement, thus the need for clear definitions and standards for green steel.

• In the EU, the steel industry’s engagement with the ESPR was very limited in 2023-2025. ArcelorMittal has mostly been supportive of the ESPR since 2020, supporting “recyclability and/or recycled content requirements for specific products.” European Steel Association (Eurofer) took mixed positions, appearing to support the Green Public Procurement measures but not taking a clear position on other ESPR measures.

• In India, InfluenceMap has detected limited engagement from the steel industry on India’s Green Steel Taxonomy. ArcelorMittal Nippon Steel India (AM/NS India) broadly supported the policy, while Tata Steel disclosed its engagement with the Indian government on the taxonomy with limited details on its position. The Indian Steel Association expressed broad support for the green steel taxonomy, also with limited details on its engagement.

• In Japan, a range of policies and support measures have been introduced to promote public and private procurement of low-carbon products, including defining green steel using a mass-balance method. InfluenceMap’s research finds that Japanese steelmakers — Nippon Steel, JFE Steel, Kobe Steel, and Japan Iron and Steel Federation (JISF) — have actively advocated for government support to create demand for green steel and recognize its environmental premium, with this mass-balance approach incorporated into policy documents and set to inform the basis for public funding.

• In South Korea, POSCO, Hyundai Steel, and Korea Iron and Steel Association (KOSA) occasionally advocated for the creation of a low-carbon product market, alongside other government support measures. At the same time, they emphasize the need for economic feasibility of decarbonizing the steel industry with ambiguity on whether they support a full transition in line with IPCC recommendations.