Clean Development Mechanism (CDM)
has a strategic focus on reinforcing its commitment to principles of best practices of Sustainability as a competitive advantage. Allied to this concept, ArcelorMittal Tubarão
searches for the development of actions that employ clean technology to reduce CO2
emissions, joining the world effort to minimize the global warming tendency that results from the greenhouse effect increase.
Among the strategies established by the Kyoto Protocol for the world reduction of CO2
emissions is the CDM, a tool that allows an interaction between developed (called Annex1) and underdevelopment (called non Annex 1) countries to obtain Carbon Credits generated to reduce the production of gases responsible for the greenhouse effect.
ArcelorMittal Tubarão has some CDM projects:
Electric Energy Optimization and Co-generation Project
Barges Terminal Project
This way, following the strategy defined by the Kyoto Protocol, ArcelorMittal Tubarão
developed a CDM project called "Electric Energy Optimization and Co-generation
", whose content can be found in the Project Design Document
(PDD). The project involves Thermoelectric Station 4 (CTE), generating electric energy from LDG (gases from steel making).
Since February 2007 ArcelorMittal Tubarão is able to get the Certified Emission Reduction (CER), known as carbon credits certificate. It is the first CDM project for carbon credit generation in the integrated steel sector worldwide, validated and registered in the UNFCCC.
The reduction in the internal consumption and the availability of energy surplus resulting from this initiative will prevent the generation of approximately 430 thousand tons of CO2 with the reduction of Greenhouse Gases emission. The gases from steel making have been reused since September 2004, in the four ArcelorMittal Tubarão thermo-electrical stations, which have an installed capacity of 286 MW, thus allowing self-sufficiency in energy. Environmental and industrial issues are not opposites. On the contrary, when we integrate the environmental management system with the production system it is possible to reach the lowest production costs in the world.
Heat Recovery Project
The Barges Terminal project is another CDM Project at ArcelorMittal Tubarão, which started operation in Vitoria, in September 2009. An investment of R$15 mi, the Barges Terminal was built to transport 1.1 million tons per year of hot coils to ArcelorMittal Vega, in Santa Catarina.
Four barges operate by a cabottage system transporting the equivalent of 110 trucks (per day) running around 1,170 km between the cities of Vitoria and Sao Francisco do Sul (SC).
The transportation of the load by water contributes to the reduction of Greenhouse gases from trucks fuel consumption. The transportation by barges also generates an economy of 60% in comparison with road transportation. 840 thousand tons of carbon credits are estimated to be generated in the next seven years.
The project is part of the ArcelorMittal Tubarão Strategic Plan, whose corporate management in the environmental area assesses and analyses new investments, taking into consideration not only the environmental risks, opportunities and legislation, but also ensures the continuous improvement of processes, allowing a reduction or elimination of environmental impacts.
What is Carbon Credit?
The ArcelorMittal Tubarão Expansion started operation in 2007, leading to a steel production capacity of 7.5 m/t, from a previous 5 m/t per year, increasing its coke consumption. To meet this demand Sol Coqueria Tubarão was created in 2005 (formed by ArcelorMittal Tubarão - 62%, ArcelorMittal Long - 37%, and Sun Coke international - 1%), which also supplies coke to other Brazilian steel plants.
Sol Coqueria is implementing the CDM called Heat Recovery (HR), consisting of the co-generation of electric energy from the heat recovered in the coke production process. This is a technology rarely used in the world and one of the best available in terms of environmental control. Besides that, it is approved by the Environmental and Water Resources State Institute (IEMA) and complies with the standards of the American Environmental Protection Agency - EPA.
The CDM project is forecast to contribute to the reduction of around 3.4 Mt of CO2
in ten years, besides controlling all the environmental impacts and having them approved by environmental authorities.
The project shows the commitment of the company to sustainability, the aim to work act in a proactive way through solutions connected to the climate change issue, keeping a balance between its growth and social environmental issues.
Carbon Credits are reductions of Greenhouse Effect Gases, established through targets met, which can be traded through buying and selling quotes. These targets have been created to try to solve problems such as the gradual increase of Earth's temperature and the respective impacts resulting from the growing emission of Greenhouse Effects Gases. They are registered in the Kyoto Protocol, a treaty signed by representatives of several countries in 1997 in Japan, and came into force in February 2005, after the ratification of 141 countries.
The treaty establishes targets for the reduction of polluting gases (between 2008 and 2012 lowering by 5.2% the emissions from 1990) for the signatories listed in the Annex 1 of the Protocol (EU and East European countries, Canada, Croatia, Greece, Iceland, Japan, Latvia, Liechtenstein, Lithuania, Luxemburg, Monaco, New Zealand, Netherlands, Romania, Sweden, Switzerland, Ukraine and the USA.
Therefore, the term Carbon Credit came up having in mind the mechanisms used between interested countries to make it easier for them to meet reduction targets.
To get the certificates, the company must go through a series of steps from the preparation of the Project Design Document (PDD), going through "Methodology", "Validation", "Registration", "Monitoring", "Checking" and "Certification" until it reaches the issuing of a CER approved by a commission managed by the UNO.
In the case of ArcelorMittal Tubarão
the certificates were obtained through projects that fall in the Clean Development Mechanism category, aimed at reducing emission or preventing that they occur in the future. The CDM is a tool created by the Kyoto Protocol which allows the countries from Annex 1 to invest in other nations, such as Brazil, through projects to reduce greenhouse effects.
The projects are directly included in the ArcelorMittal Tubarão Strategic Plan, whose corporate management in the environmental area assesses and analyses new investments, not only taking into consideration environmental risks, opportunities and legislation, but also assuring the continuous improvement of processes, leading to a reduction or elimination of environmental impacts.