BHP says high costs, limited demand slow steel decarbonisation projects
BHP•BHP says high capital costs, limited access to competitively priced energy and hydrogen, and weak demand are pressuring steel decarbonisation projects. It found US$24 billion was committed to investment in the 12 months to April 2026.
1. Project economics under pressure
BHP’s analysis found that steel decarbonisation investment continues despite softer funding commitments, with US$24 billion committed in the 12 months to April 2026. High capital costs, limited access to competitively priced energy and hydrogen, and weak demand for lower-emissions steel are pressuring project economics. Several incumbent European steelmakers have delayed or scaled back major projects as carbon policy changes shape investment timing and economics.
2. Multiple technology pathways
BHP said regional differences require multiple technology pathways, including emissions reductions at existing blast furnaces alongside alternative routes toward near-zero-emissions steelmaking.
