Green Steel and Global Trade

• Pages: 49-58
• Date: 01 July 2025
• Published date: 01 July 2025
• Author: Ganeswar Matcha
• Subject Matter: Administrative & Public Law

JULY/AUGUST 2025 ENVIRONMENTAL LAW REPORTER 55 ELR 10401

The production and manufacturing of steel dates

back to the 1740s, when an English i nventor, Benja-

min Huntsman, initially invented crucible (or cast)

steel, which was more uniform in composition and freer

from impurities than any previously produced.1 Steel is a

foundational material in modern industria lization, with

global production nearing 1.9 billion tons annually.2 Yet,

this scale comes with a steep environmental cost: the iron

and steel sector contributes nearly 7% of global anthropo-

genic greenhouse gas (GHG) emissions.3 ese emissions

are largely due to the sector’s reliance on coal-based pro-

duction methods, particula rly traditional blast furnaces.

As global climate commitments tighten and industrial

decarbonization becomes urgent, green steel, produced

using low-carbon alternatives such as green hydrogen and

renewable electricity, has emerged as a potential solution.

First introduced as a proof of concept at the 26th Con-

ference of the Parties (COP26) in Glasgow, green steel

now represents a crucial pillar of the net-zero transition.4

Its promise lies not only in emissions reduction, but in

reconguring industr ial competitiveness, aligning national

climate goals with evolving trade regimes. However, this

transition is constrained by multiple barriers, par ticularly

1. McCreath Laboratories Blog, People of Steel: Benjamin Huntsman, https://

www.mccreathlabs.com/blog/people-of-steel-benjamin-huntsman/ (last vis-

ited May 22, 2025).

2. Rolf Willeke, World Steel Recycling in Figures: January-December 2023

Update, BIR, https://www.bir.org/members-area/world-mirrors/mirrors-

ferrous/1000030286-world-steel-recycling-in-gures-january-december-

2023-update (last visited May 22, 2025).

3. Holger Stamm & Nils Naujok, Why Steel Can Be an Unexpected Leader

in Decarbonization, W E. F. (Aug. 29, 2023), https://www.

weforum.org/stories/2023/08/why-steel-can-be-an-unexpected-leader-in-

decarbonization.

4. Andrew Purvis, Steel in the Glasgow Breakthroughs Programme, W S

A’ B (Nov. 16, 2021), https://worldsteel.org/media/blog/2021/blog-

cop26-steel-in-the-glasgow-breakthroughs-programme/.

the high cost and limited availability of green hydrogen,

the need for reliable renewable energy sources, and the

lack of harmonized international regulatory standards. For

many deve loping and least de veloped countries, t hese chal-

lenges are compounded by insucient infrastr ucture and

climate nance.

is Comment explores how national and international

regulations are shaping the future of green steel, focusing

on the interplay between climate policy and trade law. It

examines key instruments such as the European Union’s

(EU’s) Carbon Border Adjustment Mechanism (CBAM),

the United States’ Ination Reduction Act (IRA) and

Buy Clean Initiative, and the United Kingdom’s (U.K.’s)

emerging carbon adjustment frameworks. Specia l atten-

tion is paid to the legal implications of these policies under

the World Trade Organization (W TO) framework, partic-

ularly with respect to the principles of nondiscrimination

and fair market access.

Ultimately, I argue that green steel cannot succeed as

a global climate strateg y without international legal coop-

eration, equitable nancing mechanisms, and inclusive

regulatory design. Green industria l policy must balance

climate ambition with fairness in trade and development,

especially as regulatory asymmetries risk excluding emerg-

ing economies from decarbonized ma rkets.

I. Technological Innovation

in Green Steel Production

Technological innovation in green steel production is essen-

tial for a successfu l transition from traditional coa l-based

methods to sustainable alternatives. While the introduc-

tion of the green steel ingot at COP26 signals a promis-

ing future for the industry, achieving f ull-scale production

requires further research and development (R&D), which

is currently underway. e current green steel is approxi-

mately 40% more expensive than traditional coal-based

steel, which is prohibitively expensive for many States across

the world. e signicant 40% cost dierence includes t he

potential transition to instal l low-emission equipment, and

revamping the production facilities and the supply chain.

As demand for low-emission steel grows and economies

of scale begin to take hold, experts predict that the price

gap will narrow. Some projections show that low-emis-

Author’s Note: I would like to take this opportunity to ex-

press my profound gratitude to Prof. Padideh Alai, Professor

of Law at American University Washington College of Law,

and Prof. Michael Cavanaugh, Adjunct Professor at Ameri-

can University Washington College of Law and Consult-

ing Counsel at Holland and Knight, whose guidance and

unwavering support have been instrumental in shaping my

academic and professional journey in the f‌ield of law.

GREEN STEEL AND GLOBAL TRADE:

LEGAL PATHWAYS AND

POLICY BARRIERS IN THE

LOW-CARBON TRANSITION

by Ganeswar Matcha

Ganeswar Matcha is the Managing Director of Sacha Group LLC.

Copyright © 2025 Environmental Law Institute®, Washington, DC. Reprinted with permission from ELR®, http://www.eli.org