Michael Sortwell and Paul Balserak American Iron and Steel Institute November 20, 2017

The United States Iron and Steel Industry – Energy Perspective

2

U.S. Raw Steel Production and Capacity Utilization

57.0 52.8 36.7

49.4 52.1 52.4 52.6 55.2 49.4 52.6

41.1 39.1

22.7

31.1 34.3 36.3 34.2 33.0 29.4 25.9

0.0

20.0

40.0

60.0

80.0

100.0

120.0

140.0

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Mill

ion

Met

ric T

ons

Production by Furnace Type (net tons)

EAF Production BOF Production Capability

Source: AISI

3

U.S. Steelmaking Capacity Utilization

40

50

60

70

80

90

100

19951996199719981999200020012002200320042005200620072008200920102011201220132014

annual, 1995 to 2014

2015

2016

2016

weekly, 2015 to November 4, 2017

week of 11/4: 73.6% 2017 YTD: 74.6%

Raw steelmaking capacity utilization (percent) has trended higher recently but remains historically low.

Source: AISI

4

U.S. Net Shipments by Market Classification

National Defense and Homeland Security

3%

Appliances 5%

Container 4%

Other 3%

Machinery and Equiptment

9% Energy 6%

Automotive 27%

Construction 43% Source: AISI – 2016 domestic shipments only (excludes exports)

*includes estimated allocation of Service Center shipments,

5

Steel Recycling

• In 2015, over 54 million metric tons of steel scrap was recycled into new steel products

– The overall recycling rate was 76%

• 2015 recycling rates for individual steel product categories include:

– Automobiles 87% – Appliances 88% – Containers/Packaging 71% – Construction/Structural 98% – Construction/Rebar 71%

6

Steel Recycling

• Steel recycling is inherent to the steelmaking process, offsetting demand for energy and natural resources and creating demand for end of life steel products

• Nearly all co-products from the steelmaking process in North America are recycled or reused

7

Collaborative Research Program

• Committee on Manufacturing Technology (COMT) – AISI Producer and Associate Members – Gives direction on R&D projects

• AISI acts on behalf of Industry Participants – Solicit research proposals – Facilitate analysis of proposals – Provide project management

8

Collaborative Research Vision

• Healthy range of projects – Implementation

– Immediate 1-2 years – Long Range 10-15 years

– Direction – Industry, Academia, Customer

9

Priority Research Topics

• Advanced measurement technology • 3D printing/ additive manufacturing and steel

– Technical barriers – Impact on competing materials

• Recycling of steel plant co-products • CO2 reduction

10

Research Proposal Solicitation

• Topics – Data Analysis/optimization – Slag depth/composition – High temperature measurement

• 1.5 – 4 years • $150,000 - $2,000,000+

11

U.S. Steel Industry Energy Intensity

0

2

4

6

8

10

12

14

16

18

1990 1995 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

M B

TU/T

on

The industry has reduced energy intensity per ton of steel shipped by 31 percent per ton of steel produced since 1990.

12

Steel Sector GHG Emissions

0

20

40

60

80

100

120

1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

MM

T CO

2 Eq

.

U.S. GHG Emissions from iron and steel production have decreased by 51 percent since 1990.

Source: U.S. EPA Inventory of U.S. Greenhouse Gas Emissions and Sinks, 1990-2015

13

U.S. Electricity Generation by Fuel Slight increase in share of coal-fired electricity, yet substantial decrease over past decade

14

U.S. Electricity Sector CO2 Emissions U.S. electric utility CO2 emissions decrease toward Clean Power Plan (CPP) goal

2,600 CO2 Emissions/MMTs