May 11, 2026 - The global steel industry’s green transition is threatened by continued spending on coal-based production and underinvestment in cleaner methods, according to a clean energy research group.

Some 319 million tons of annual blast furnace capacity that uses coal is under development, a 5% increase from the previous year, according to Global Energy Monitor’s annual report on the steel sector. Combined with the overhaul of another 80 million tons of existing facilities, the total far outpaces the 141 million tons that’s due to be retired.

The upshot is that global blast furnace capacity is projected to grow by a net 88 million tons by 2035, the report said.

The steel sector contributes 11% of the world’s carbon emissions, led by China and India. Greener, though costlier, technologies such as electric arc furnaces and direct reduced iron production haven’t kept up with the industry’s coal-based additions.

GEM said EAF’s share of global capacity rose by just 1 percentage point last year to 34%. Lower run rates in China, by far the world’s biggest steel producer, have hampered efforts to reduce emissions from a sector that accounts for 17% of the country’s total, according to a report last year from the Centre for Research on Energy and Clean Air.

“The outlook remains bleak for steel’s transition away from fossil fuels,” said GEM project manager Astrid Grigsby-Schulte. “The ball is in India and China’s court, as the two countries plan 86% of new coal-based capacity.”

“Pivoting to lower-emissions technologies and using existing EAF capacity more effectively are two immediate steps the countries can take,” she said.