What happened
A roadmap prepared by Agora Industry, with support from Istanbul Policy Center and the Sustainable Economics and Finance Research Association, sets out pathways for decarbonising Turkey’s steel industry through 2050.
The study estimates that the sector needs roughly €1.5 billion in investment each year over the next 20 years. It says a national emissions trading system and a domestic carbon-border mechanism could generate €0.5 billion to €1.5 billion annually, creating a potential source of funding for lower-emission steel production.
Under the accelerated pathway, emissions from the sector fall by 92% by 2050 compared with 2025. The report identifies this as the only pathway assessed that is consistent with Turkey’s 2053 climate-neutral objective.
The analysis finds that coal-based and gas-based iron production reach cost parity at a carbon price of about €100 per tonne of carbon dioxide. For iron made with green hydrogen, the comparable level is about €140 per tonne. If Turkish prices follow the EU emissions trading system, these levels could be reached in the latter part of the 2030s.
Why it matters
Steel accounts for about 40% of Turkey’s industrial emissions, making the sector central to the country’s industrial climate plans. The roadmap argues that carbon revenue could remain in Turkey rather than being paid abroad on steel exports, if domestic carbon pricing reaches the level of the EU system. It estimates this could retain around €1.5 billion a year for use in a green-steel fund.
For steel producers, the findings point to a commercial choice between early investment in near-zero-emission iron and steelmaking, or growing exposure to imported material and carbon-related trade costs. Companies exporting to the EU could also be better placed to manage the effects of the bloc’s carbon-border rules if they reduce emissions.
The report estimates limited price effects for some consumer goods using green steel: about €270 for an electric car, €8 for a washing machine and €9 for a household air-conditioning unit. It suggests public purchasing requirements, minimum-use rules and long-term purchasing contracts could help create demand for lower-emission steel.
Background
Turkey is the world’s largest scrap importer, while nearly 50 countries, including EU members, have introduced limits on scrap exports. The roadmap says domestic scrap collection may need to increase from 10 million tonnes to 26 million tonnes by 2050, supplemented by imports of low-emission iron.
It also projects around 29,000 new jobs in value chains covering solar and wind power, electrolyser manufacturing and green-hydrogen-based iron production. Without targeted policy support, the study warns that lower-cost imported gas-based iron could increase Turkey’s reliance on imports.
What's next
The roadmap assesses three routes to 2050: continuation of current policies, a gradual transition and an accelerated transition. The accelerated route depends on early capital investment, stronger policy support, renewable electricity, increased scrap collection and carbon-pricing measures.
Further emissions reductions could come from biochar in electric arc furnaces and fully renewable electricity supplied through the grid or power-purchase agreements. The study also points to carbon removals, including bioenergy with carbon capture and direct air capture, for residual emissions.
