Energy-related CO2 emissions in the China's iron and steel industry: A global supply chain analysis

Given the increasing pressure on China to lower the emissions of carbon dioxide (CO2), as the largest manufacturing energy user and main industrial CO2 emitter worldwide, the country's iron and steel industry is vital for making energy savings. Most of the existing researches have used single-sector data (i.e., cross-sectional data or data from multiple time series) to look into the driving forces of the industry's CO2 emissions at the national level, typically overlooking the impacts of final demand and the relationship among industries. This study is based on the global multi-regional input-output table and energy-related data. Structural path analysis is used to identify the critical supply chain paths that influence the emission of CO2 from China's iron and steel industry. These supply chain paths can be used to analyze the extent to which different types of final demand and the IO relationship among industries affect CO2 emissions in this sector. The results show that both direct demand for the output of China's industry on iron and steel and indirect demand via consuming products from other industries (e.g., construction and electrical and optical equipment) have lead to a great consumption of coke oven gas in China's iron and steel industry, which result in considerable CO2 emissions. Further more, in order to meet the demands of their manufacturing sectors and final demand, US, EU, South Korea, Japan, together with some other developed countries, have imported a great sum of goods from China's iron and steel industry, including some other manufacturing sectors, which helps them reduce their own CO2 emissions. But this action has left China with considerable energy consumption and CO2 emissions issues.